Personal Remittances Grow Markedly in November 2016; Year-to-Date Level Reaches US$26.9 Billion
Personal remittances from overseas Filipinos (OFs) reached US$2.4 billion in November 2016, rising by 18.4 percent from the year-ago level. This brought the cumulative remittances level for the period January-November 2016 to US$26.9 billion, representing a growth of 5.1 percent year-on-year, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco, Jr. announced today.1 The increase in personal remittances was driven largely by the 7.8 percent expansion in transfers from land-based workers with work contracts of one year or more to reach US$20.9 billion. This made up for the 3.6 percent decline in remittances from sea-based and land-based workers with work contracts of less than one year totaling US$5.5 billion.
Cash remittances from OFs coursed through banks grew by 18.5 percent year-on-year in November 2016 ahead of the holiday season, to reach US$2.2 billion. The top countries that contributed to the increase in total cash remittances during the month were the United States (US), United Arab Emirates (UAE), Japan, Saudi Arabia, and Qatar. On a year-to-date basis, remittances in the first eleven months of the year totaled US$24.3 billion. This represents a 5.2 percent increase from the 2015 level. Cumulative cash remittances from land-based workers rose by US$1.4 billion, compensating for the US$0.2 billion decrease in sea-based workers’ remittances amid stiffer competition in the supply of seafarers, particularly from East Asia and Eastern Europe. The improving global economic conditions, particularly in the US, may have contributed to the overall growth in remittances.
By country source, the bulk of cash remittances came from the US, Saudi Arabia, UAE, Singapore, the United Kingdom, Japan, Qatar, Kuwait, Hong Kong, and Germany. Combined remittances from these countries accounted for more than 80 percent of the total cash remittances in the first eleven months of 2016.2
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Foot Notes
1 The BSP started to release data on personal remittances in June 2012. As defined in the Balance of Payments and International Investment Position 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 formation purposes, such as for construction of residential houses, between resident and non-resident households without anything of economic value being supplied in return).
2 There are some limitations on the remittance data by source. A common practice of remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the U.S. Also remittances coursed through money transfer operators (MTOs) cannot be disaggregated by actual country source and are lodged under the country where the main offices of the MTOs are located, which, in many cases, is in the U.S. Therefore, the U.S. would show up to be the main source of OF remittances because banks attribute the origin of funds to the most immediate source.
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Press Release from the Bangko Sentral ng Pilipinas
