MANILA, Philippines – Remittances which the Filipino workers sent from abroad surpassed the target growth that was laid by the Philippine central bank last year. Remittances hit almost 31.3 billion dollars, contributing economy support to the country as an essential domestic demand driver.
Personal remittances increased by 5.3 percent from 29.71 billion dollars to 31.29 billion dollars last year, according to Nestor Espanilla Jr., Bangko Sentral ng Pilipinas governor.
Espanilla mentioned that growth was maintained in remittances because of the higher contributions that grew by 4.1 percent from land-based workers whose contracts are one year and above and by 5.3 percent from both land-based and sea-based workers whose work contracts are one year below.
Last year’s 10 percent of gross domestic product or GDP and 8.3 percent of gross national income or GNI are accounted personal remittances of employees as stated by Espanilla.
Personal remittances and cash remittances in December last year grew by 7.9 percent and 7.1 percent from December 2016’s 2.82 billion dollars to 3.05 billion dollars and 2.56 billion dollars to 2.74 billion dollars, respectively.
Furthermore, cash remittances that passed through the banks increased by 4.3 percent to its highest from 26.9 billion dollars in 2016 to last year’s 28.06 billion dollars, according to Espanilla.
Cash remittances within 2017 continued to remain strong despite political uncertainties globally.
The growth target for 2017 for both cash and personal remittances has been set by the central bank to 4 percent.
According to Espanilla, the higher cash transfers recorded in 2017 were aided by 5.4 percent and 4 percent increase in remittances from sea-based and land-based employees, respectively.
Eighty percent of the entire cash remittances came from the following countries: United States, UAE, Saudi Arabia, Japan, Qatar, Singapore, UK, Kuwait, Hong Kong, and Germany.
The major contributor for the Americas was the growth of 5.5 percent in remittances coming from the United States which grew by 5.8 percent.
Data showed that those remittances coming from Europe still grew by 1.5 percent regardless of the transfers decreasing because of the lowering of the value of pound vs. dollar.
The country recorded 76 quarters of continuous growth with the gross domestic product increasing in the 4th quarter by 6.6 percent from the 7 percent change in the 3rd quarter.
Diwa Guinigundo, Bangko Sentral ng Pilipinas deputy governor, said that despite the problems emerging from prohibiting deployments of Filipinos to Kuwait and the enforcement of higher charge on remittances, the amount of cash sent home by OFWs would still increase continuously this year.
Guinigundo noted that only around 3 percent of cash remittances come from Kuwait.
He also added that OFWs are not liable to pay the documentary stamp tax (DST) when sending money from abroad. Under the TRAIN Law signed by the president in December 2017, the DST was doubled from 30 cents to 60 cents per 200 pesos.