OFW remittances continue despite oil slump

President Benigno Aquino 111 greets departing overseas workers at airport.

Canada ranks eight in OFW remittances
Almost half of global remittances come from the USA, which contributes $10.37 billion. Saudi Arabia significantly lags behind, with remittances of $2.52 billion.

Despite slower growth last year, remittances from overseas Filipinos have so far not been affected by the slump in oil prices, the Philippine Star reported, citing the chief economist of the Department of Finance.

“So far, the steep drop in crude petroleum prices has not affected Middle East remittances,” Finance Undersecretary Gil Beltran said in an economic bulletin dated Jan. 19.

According to central bank data quoted by Beltran, remittances grew 3.63 percent to $22.83 billion from January to November last year. The growth was slower than the revised 2015 goal of four percent.

Broken down, money from the Middle East– the second major source of remittances– expanded by a faster 9.6 percent to $5.243 billion during the same period.
Global oil prices have continued their decline into 2016, plunging to new lows not seen in more than 13 years and hitting company profit margins.

This, in turn, has caused anxiety that jobs in the oil sector may be slashed, including those held by the more than two million Filipinos, according to Department of Foreign Affairs figures.

According to a Rappler report, OFWs also make an invaluable contribution to the country’s economy, accounting for most of the country’s net factor income from abroad (NFIA) through their remittances.
NFIA is the difference between what Filipinos earn abroad and what foreigners earn in the Philippines. The Philippines’ large NFIA makes up for its negative net exports.

North and South America

The leading source for OFW remittances is North and South America, accounting for $11,167,883,000 (46%), with $10,374,084,000 or 93% of these remittances coming from the world’s largest economy, the United States (USA).
Canada contributes $650,910,000 (6%).

The Middle East is second in remittances, accounting for $5,334,472,000 (22%) – less than half of the remittances from the Americas. Saudi Arabia and the United Arab Emirates account for $4,240,328,000 or 79% of all Middle Eastern remittances.

There are no remittances from the war-torn states of Iraq and Syria.
Remittances from Europe are at $3,761,139,000 (15%), with more than a third of remittances worth $1,394,706,000 or 37% coming from the United Kingdom (UK).

Nine percent or $335,451,000 of European remittances originate from troubled Greece, currently at risk of default and exit from the Eurozone if it fails to meet its obligations to the International Monetary Fund (IMF).

Asian remittances worth $3,545,271,000 approximate 15% of OFW contributions. Remittances from tiger economy Singapore lead the way with $1,178,262,000 or 33%, followed closely by those from the world’s third largest economy, Japan, with $981,882,000 or 28%.

Nepal, recently struck by a major earthquake, has minimal contributions of $115,000 (0.003%). Indonesia accounts for $16,423,000 or 0.46% of Asian remittances.

Oceania remittances amount to $510,260,000 or 2%, with Australia and New Zealand contributing $494,367,000 or 97%.

Almost half of global remittances come from the USA, which contributes $10,374,084,000. Saudi Arabia significantly lags behind, with remittances of $2,525,882,000 or 7%. – Rappler.com
Data obtained from the Bangko Sentral ng Pilipinas (BSP)