Remittances rose for the 20th straight month, as global economies that host Filipino overseas workers further reopened, resulting in sustained inflows ahead of the holiday season.
Data from the Bangko Sentral ng Pilipinas on Tuesday showed that cash remittances coursed through banks grew by 3.8 percent to $2.84 billion in September from $2.74 billion in the same month last year.
This brought cash remittances in the first nine months to $23.83 billion, up 3.1 percent from $23.12 billion recorded a year ago.
It also marked 20 consecutive months of remittance growth since January 2021 when money sent home by Filipinos working overseas declined 1.7 percent.
“The expansion in cash remittances in September 2022 was due to the growth in receipts from land-based and sea-based workers,” the BSP said in a statement.
It said the growth in cash remittances from the United States, Saudi Arabia, Singapore and Qatar contributed largely to the increase in remittances in the first three quarters.
Personal remittances, which include non-cash items, climbed 4 percent in September to $3.15 billion from $3.03 billion in the same month last year. This resulted in cumulative remittances rising by 3.1 percent in the first three quarters to $26.49 billion from $25.70 billion.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the continued growth in OFW remittances could be attributed to the need of OFWs and their dependents to pay for higher prices locally and support more of their local spending with the further reopening of the economy towards greater normalcy.
“However, the modest single-digit growth in OFW remittances in recent months may be partly attributed to elevated US/global inflation and higher interest rates in recent months,” he said.
Ricafort said whatever gains OFWs and their families might have due to more peso proceeds for their US dollars could be offset by higher inflation.
“Thus, there may still be a need to send more OFW remittances due to higher inflation, which erodes whatever foreign exchange gains due to the stronger US dollar vs. major global currencies,” Ricafort said.
Studies showed that remittances from overseas Filipino workers were consistently the fourth largest in the world after India, China and Mexico, amounting to about $35 billion in 2020, a sign of resilience despite the COVID-19 pandemic.
The Philippines is among the biggest suppliers of nurses around the world, accounting for at least 20 percent of the total globally. The Philippines is also the biggest supplier of seafarers worldwide, accounting for about 20 percent to 25 percent of the total.
The deployment of OFWs has become more diversified over the years to include more countries worldwide, especially those outside the traditionally biggest host countries.
Cash remittances hit a record $31.418 billion in 2021, up 5.1 percent from $29.903 billion in 2020.
The 5.1-percent expansion last year reversed the 0.8-percent contraction in 2020 that was due mainly to the pandemic.
The BSP expects remittances to grow by 4 percent amid the improving global business environment in 2022.