Personal remittances from overseas Filipinos (OFs) posted a new record high at US$3.0 billion in December 2017, representing an expansion of 7.9 percent relative to the level recorded in the same month last year. This brings the cumulative personal remittances level for January to December 2017 to US$31.3 billion, 5.3 percent higher than the US$29.7 billion level in the previous year and exceeding the BSP’s projection of 4.0 percent for 2017, Bangko Sentral ng Pilipinas Governor Nestor A. Espenilla, Jr. announced today.1 The sustained growth in personal remittances during the year was steered by the increase in remittances from land-based workers with work contracts of one year or more (by 4.1 percent) and from sea-based and land-based workers with work contracts of less than one year (by 5.3 percent). The growth in OF remittances continued to provide support to the country’s economy as a major driver of domestic demand. The 2017 level of OF personal remittances accounted for 10.0 percent of gross domestic product (GDP) and 8.3 percent of gross national income (GNI).
Similarly, cash remittances from OFs coursed through banks registered an all-time high of US$2.7 billion, rising by 7.1 percent year-on-year in December 2017. The top countries that contributed to the increase in total cash remittances during the month were the United States (US), United Arab Emirates (UAE) and Singapore. Full-year cash remittances totaled US$28.1 billion, 4.3 percent higher than the US$26.9 billion recorded in 2016. The higher cash remittances in 2017 was supported by the increase in transfers from both land-based and sea-based workers, by 4.0 percent and 5.4 percent, respectively.
Notwithstanding pockets of political uncertainties across the globe, cash remittances in 2017 remained resilient. Remittances from the Middle East increased by 3.4 percent, driven by growth in remittances from the UAE, Qatar, and Bahrain. OF remittances from Asia rose by 7.3 percent, boosted by transfers originating from Singapore, Japan, and Taiwan. For the Americas, which increased by 5.8 percent, the major contributor was the 5.5 percent growth in remittances from the US. Despite the decrease in remittances coming from the United Kingdom (partly due to the depreciation of the pound sterling vis-à-vis the US dollar), remittances from Europe went up by 1.5 percent.
By country source, the bulk of cash remittances for the year came from the US, UAE, Saudi Arabia, Singapore, Japan, United Kingdom, Qatar, Kuwait, Germany, and Hong Kong.2 The combined remittances from these countries accounted for 80.1 percent of total cash remittances.
1 The BSP started to release data on personal remittances in June 2012. As defined in the Balance of Payments Manual, 6th Edition (BPM6), personal remittances represent the sum of net compensation of employees (i.e., gross earnings of overseas Filipino (OF) workers with work contracts of less than one year, including all sea-based workers, less taxes, social contributions, and transportation and travel expenditures in their host countries), personal transfers (i.e., all current transfers in cash or in kind by OF workers with work contracts of one year or more as well as other household-to-household transfers between Filipinos who have migrated abroad and their families in the Philippines), and capital transfers between households (i.e., the provision of resources for capital purposes, such as for construction of residential houses, between resident and non-resident households without anything of economic value being supplied in return).
2 Remittance centers in various cities abroad course remittances through correspondent banks, most of which are located in the U.S. These remittances coursed through money couriers cannot be disaggregated by actual country source and are lodged under the country where the main offices are located, which, in many cases, is in the U.S.