OVERSEAS FILIPINOS REMITTANCES HIT $10.47 B IN 9 MONTHS, UP 15%
MANILA, NOVEMBER 16, 2007 (BULLETIN) By LEE C. CHIPONGIAN - Overseas Filipinos (OFs) remitted $ 10.477 billion in the first nine months to September, up 14.98 percent from the same period last year, and 12.41 percent higher than August’s $ 9.337 billion.
For September alone, remittances totalled $ 1.139 billion, 5.56 percent lower than August’s $ 1.206 billion.
The Bangko Sentral ng Pilipinas (BSP) said preliminary data from the Philippine Overseas Employment Administration noted an increase in the number of deployed workers in September, or up by 8.7 percent. By type of worker, the number of deployed land-based and sea-based workers rose by 3.2 percent to 70,023 and by 29.2 percent to 23,461, respectively.
"The number of deployed Filipino workers has been growing since July 2007, moderating the contraction in deployment seen in the early part of the year. As a result, yearto-date, the decline in the total number of deployed workers has slowed down to 1.7 percent to reach 827,275," BSP said. OFs are mostly based in the US, the United Kingdom, Italy, the United Arab Emirates, Saudi Arabia, Canada, Singapore, Japan, and Hong Kong.
The government, led by Malacanang, will hold a big forum or plenary to discuss and agree on a package of reforms that would help foreign exchange earners and remitters, such as exporters and OFs, cope with the continued rise of the peso.
Bangko Sentral ng Pilipinas (BSP) Managing Director Cyd Tuano–Amador said the BSP continues to review the lowering of remittance charges, easier identification of an OF and their beneficiaries, allowing rural cooperative banks to accept remittances to give beneficiaries in remote areas quicker access to funds.
In the meantime, despite that a large population has come to depend on the dollar sent home by their overseas family member, the BSP said so far, there is no evidence of "Dutch disease."
According to a BSP paper "Philippine Overseas Workers and Migrants’ Remittances: The Dutch Disease Question and the Cyclicality Issue," while remittances play a significant role in the economy, there is still "no strong evidence to suggest that remittances have led to (a) Dutch disease phenomenon."
Dutch disease, which describes the deterioration of the manufacturing sector in the Netherlands in the 1970s due to strong reliance on natural gas production, is an economic theory that explains that de-industrialization of a nation because of its dependency on other revenue sources, specifically, foreign exchange inflows.
The BSP said this has not happened to the Philippines yet, despite that remittances have become the second largest source of foreign exchange for the Philippines, after exports.
"(In) some countries, remittances have fostered complacency (that is not) conducive to stronger and more broad-based growth," the authors of the paper led by Tuaño-Amador said. "However in other countries, remittances have provided economies the much needed foreign exchange and policy space to undertake the necessary macroeconomic policy adjustments."
Dutch disease "stemming from remittances" is avoidable. "The challenge with Dutch disease (lies) not so much on the foreign exchange coming in but in directing these private inflows toward productive activities," the paper added.
Chief News Editor: Sol Jose Vanzi
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