Remittances posted the fastest growth in four months amid the continued reopening of the domestic economy and as Filipinos working overseas sent home more money in time for vacation and Holy Week-related spending.
Latest data from the Bangko Sentral ng Pilipinas on Thursday showed that cash remittances coursed through banks went up 3.7 percent in April to $2.48 billion from $2.40 billion a year ago. This was the fastest growth since December 2022 when inflows rose 5.8 percent.
“The expansion in cash remittances in April 2023 was due to the growth in receipts from land- and sea-based workers,” the BSP said in a statement.
This brought cash remittances in the first four months to $10.49 billion, or 3.2 percent higher than the year-ago level of $10.17 billion.
The BSP said higher remittances from the United States, Singapore and Saudi Arabia contributed mainly to the increase in remittances in the four-month period. The US posted the highest share of overall remittances during the period, followed by Singapore, Saudi Arabia and Japan.
“This may have to do with increased OFW remittances sent back home in April 2023 in time to finance holiday-related spending during the Holy Week, considered the next biggest after the Christmas holiday season,” said Michael Ricafort, chief economist of Rizal Commercial Banking Corp.
Ricafort said more people traveled to go back to their respective provinces for the long holiday weekend.
He said the relatively high inflation also compelled OFWs to send more money to their relatives in the country. Inflation peaked at 8.7 percent in January 2023 but eased to 8.6 percent in February, 7.6 percent in March and 6.6 percent in April. Despite the successive slowdowns, inflation remained elevated over the target range of 2 to 4 percent.
Personal remittances, which include non-cash items, rose 3.8 percent in April to $2.77 billion from $2.67 billion a year earlier, bringing the cumulative four-month tally to $11.68 billion, up 3.2 percent from $11.32 billion a year ago.
The BSP said the increase in personal remittances in April was due to higher remittances sent by land-based workers with work contracts of one year or more, and sea- and land-based workers with work contracts of less than one year.
Cash remittances rose 3.6 percent in 2022 to a record $32.54 billion from $31.42 billion in 2021 on sustained demand for skilled Filipino workers.
The growth in cash remittances from the United States, Saudi Arabia, Singapore, Qatar, and United Kingdom contributed largely to the increase in remittances from January to December 2022. In terms of country sources, the US posted the highest share of overall remittances in 2022, followed by Singapore and Saudi Arabia.
The Philippines is among the biggest suppliers of nurses and seafarers around the world.
The Bangko Sentral expects remittances to grow by 3 percent in 2023.
