REMITTANCE growth is projected to sustain its momentum this year, but the Covid-19 outbreak remains a threat.
Cebu Bankers Club former president Maximo Eleccion is optimistic the money sent home by overseas Filipino workers (OFWs) will continue to rise amid the uncertainties abroad.
“Remittances has been growing up and we are optimistic that it will still grow this year. The Covid-19 is a threat that we hope will not worsen,” the banker told SunStar Cebu Wednesday, Feb. 19, 2020.
In 2019, remittances reached a record high despite global uncertainties as higher inflows from other countries offset a dip in remittances from the Middle East.
Cash remittances grew 4.1 percent to US$30.133 billion in 2019 from $28.943 billion in 2018, data from the Bangko Sentral ng Pilipinas (BSP) showed.
The growth in cash remittances last year was well above the three percent projection of the BSP for 2019.
Personal remittances, which include inflows in kind, rose 4.1 percent to $33.467 billion from the $32.213 billion logged in 2018.
“Notwithstanding pockets of political uncertainties across the globe, cash remittances in 2019 remained strong,” the BSP said in an earlier statement.
Covid-19 impact
Looking into this year, the virus outbreak, which originated in China, stands as a key threat as nearly a quarter of remittances come from Asia.
The Covid-19 has forced people into quarantine which is likely to hit consumption activity and affect the services industry, where most OFWs are employed.
However, Eleccion, Visayas area business director at BPI Family Savings, believes remittances can sustain like in previous economic crises.
“We however still saw growth in OFW remittances during the severe acute respiratory syndrome outbreak,” he said, referring to the 2002 to 2003 China-originating virus epidemic that rocked markets across Asia.
Last year, inward remittances from Asia, the Americas and Africa grew annually by 12.3 percent, 10.6 percent and 4.8 percent, respectively.
The growth of inflows from these regions made up for the 9.8 percent decline in remittances from the Middle East.
The BSP said the bulk of remittance inflows in 2019 came from the United States, which comprised more than a third or 37.6 percent of total inflows. This was followed by Saudi Arabia, Singapore, Japan, United Arab Emirates, the United Kingdom, Canada, Hong Kong, Germany and Kuwait, which collectively were the source of 78.4 percent of the total cash remittances.
OFW remittances have remained strong over the years even with global recessions that have hit Filipinos’ host countries.