Remittances from overseas Filipino workers (OFWs) coursed through banks recorded a year-on-year growth of 28.3 percent in August 2005 to reach US$954 million. This brought the cumulative 8-month level to US$7.0 billion, up by 28.0 percent over last year’s level of US$5.5 billion. Given the more than 20 percent year-on-year expansion that has prevailed since February, remittances are expected to remain strong going into the holiday season.
The vigorous marketing campaign (e.g., enhanced money transfer services, more remittance centers, tie-ups with foreign financial institutions and collection agents) pursued by commercial banks has encouraged overseas workers to increasingly utilize banking channels in transferring funds to their beneficiaries.
Contributing also to the continued surge in overseas workers’ remittances is the increase in the number of deployed Filipino workers during the first eight months of 2005. On the aggregate, preliminary data from the Philippine Overseas Employment Administration (POEA) showed that the total number of deployed workers rose by 1.6 percent to 660,726 following the continuing efforts by the government in cooperation with the private sector to provide skills-enhancing and other development programs. Classified by type of worker, deployment of sea-based workers rose by 9.7 percent to 165,896, compensating for the minimal 0.8 percent decline in the deployment of land-based workers. Moreover, the deployment of higher-paid overseas workers (e.g., seafarers, service staff, professional/technical workers, production related workers) also boosted the level of remittances during the eight-month period.
OFW remittances remain to be an important component of the national income accounts and the balance of payments (BOP). For the first semester of 2005, remittances accounted for about 11 percent of nominal gross domestic product and about 18 percent of total current account receipts.
The U.S.A., Saudi Arabia, Italy, Japan, Hong Kong, U.K., United Arab Emirates and Singapore have remained to be the major sources of OFW remittances.