MANILA: Money sent home monthly by overseas Filipinos workers (OFWs) in January grew sharply year-on-year, marked by notable annual increases in remittances by land-based workers with longer contracts, central bank data showed.
However, remittances in January fell from the December level.
The central bank did not give an explanation for the month-on-month decline but an analyst said it was due to seasonal factors.
Personal remittances rose 8.5 percent to $2.39 billion in January 2017 from $2.20 billion in January 2016.
The rate of annual increase in January more than doubled the 3.6 percent annual increase in December, but on a month-on-month comparison, remittances in January at $2.39 billion were lower than the $2.82 billion generated in December.
Focusing on the year-on-year increase in January alone, the Bangko Sentral ng Pilipinas (BSP) said the sustained rise was driven mainly by the 13.5 percent growth in transfers from land-based workers with work contracts of one year or more (which summed up to $1.9 billion), more than offsetting the 8.3 percent decline in remittances from sea-based and land-based workers with work contracts of less than one year (at $400 million).
An IHS Markit economist said the month-on-month decline in the value of remittances may be traced to seasonal factors.
Personal remittances are transfers in cash or in kind, as well as capital transfers between households.
Analysts said that despite an expected slowdown in remittances this year, their nominal value will still be higher than in 2016.
IHS Markit expects the Philippine economy to grow by 6.3 percent in 2017, supported by continued strong growth in private consumption, as well as investment.
“Strong growth of foreign worker remittances will also help boost the current account position of the Philippines,” he said.
Another economist also forecast that OFW remittances this year will exceed the level in 2016.
“Remittance growth [is expected] to remain subdued in 2017, but still slightly better than in 2016, and supportive in the near term,” Chidu Narayanan from Standard Chartered Bank said.
