Send money to Philippines is expected to climb by as much as 7% this year, bucking the worldwide decline and supporting a comeback in family expenditure, according to financial giant Morgan Stanley. Access to social aid provided by host economies undoubtedly aided some OFWs (overseas Filipino workers), whereas OFWs in Asia were likely less affected by lockdown restrictions.
Furthermore, altruistic motivations and border barriers are likely to have prompted OFWs to send more money home via legitimate channels. Finally, a large number of OFWs work as domestic helpers/health-care workers, which are in high demand despite the pandemic, providing downside protection.
Personal remittances – cash or online money transfer to Philippines for families for OFW — totaled $2.76 billion in the second month of 2021, down 4.62 percent from $2.89 billion in January but up 5.3 percent from $2.62 billion a year earlier, according to data provided by the Bangko Sentral ng Pilipinas (BSP) recent report. According to a statement, the central bank attributed the increase to a 7.8% increase in remittances from land-based workers with one-year or longer contracts, which rose to $2.15 billion from $1.99 billion a year ago.
What Are The Factors That Impact The Flow Of Remittance To The Philippines?
For the time being, money transfers to Philippines are increasing each month; however, mention the new, more contagious coronavirus varieties and any ensuing restrictions in key OFW host countries to stem the spread of illness, as reasons that might potentially interfere with remittances, as well as any delays in these countries’ vaccine efforts.
What Is The Importance Of International Money Transfers To the Philippines Economy?
After India and China, the Philippines was the third-largest beneficiary of migrant remittances in 2013. Remittances from overseas Filipino workers (OFWs) totaled USD 25.1 billion in 2013, according to the Philippine Central Bank. It was 7.6% greater than the previous year’s remittances, accounting for 8.4% of the Philippines’ gross domestic product (GDP) in 2013. The United States, the United Kingdom, Australia, Canada, and other developed countries were among the remittances’ source countries. Expatriates who send money to Philippines online are extremely important to the government.
Remittances from overseas Filipino workers and growth in the Business Process Outsourcing (BPO) sector are the main drivers of its economic growth. Furthermore, it is impossible to rule out the possibility that development is linked to the world economy. Economic growth is bound to suffer in the case of a catastrophe. As a result, more focus must be directed to fixing the economy’s internal difficulties and increasing domestic-oriented growth. A policy of reducing structural growth barriers, with less emphasis on foreign investors and exporters, must be implemented.