Remittances defy bleak forecasts, may still grow this year despite pandemic: industry player

Art Fuentes, ABS-CBN News

Posted at Dec 03 2020 05:05 PM

Remittances defy bleak forecasts, may still grow this year despite pandemic: industry player 1
Arriving OFWs at the NAIA Terminal 1 undergo health protocols and fill out documents while being assisted by Philippine Coast Guard personnel before getting clearance from the Philippine Red Cross to get swab tests on October 28, 2020. Jonathan Cellona, ABS-CBN News

MANILA - Remittances from overseas Filipinos may still grow this year despite the disruptions caused by the COVID-19 pandemic, a remittance company said on Thursday. 

WorldRemit said that despite bleak projections months ago, remittances have been actually rising in the last few months. It’s possible that the amount of money sent home by Filipinos abroad may even end up larger this year compared to 2019, said WorldRemit country director Earl Melivo.

“The actual remittances year-to-date September is actually defiant of the previous pessimistic projections even by the government,” Melivo said during an online conference with journalists. 

Melivo pointed out that the Labor Department forecast remittances to drop by as much as 40 percent this year, as the pandemic caused thousands of OFWs to lose their jobs. He said this did not pan out.

Official data from the Bangko Sentral ng Pilipinas showed that in September, cash remittances grew 9.3 percent to $2.6 billion.

From January to September, cash remittances have so far declined by only 1.4 percent to $21.886 billion compared to the same period last year.

WorldRemit projects that remittances in 2020 may end up at almost the same level last year, or decline by at most 2 percent. An optimistic projection is that it may even grow by 1 percent to 2 percent, he said. 

“We feel that optimistically, we’ll still hit $33 billion this year.”

With Christmas approaching, Melivo said, overseas Filipinos are bound to send even more money home. 

He said a WorldRemit survey of over 3,000 individuals in the UK, US, Canada, and Australia, showed that 84 percent of respondents are planning to send more money, or about the usual amount to the Philippines for Christmas. 

Melivo also downplayed suggestions that remittances held ground despite the pandemic because many overseas Filipinos were sending home their life savings before coming back to the country. 

He said the impact of the pandemic on OFWs was not as big as what some have forecast.

“In my humble opinion, it’s only a small portion of the overseas Filipino market. If you look into the repatriation numbers, only a small portion did that.”

WorldRemit is also optimistic that remittances would bounce back in 2021 as economies around the world reopen and vaccinations for COVID-19 get underway. 

"Given the positive prospect of us having the vaccine already available in many of those countries by early next year, we only see growth by 2021."

The BSP is expected to release official remittance data for October on Dec. 15.

The Philippines is one of the world's largest recipients of remittances that drive domestic consumption, which is a key pillar of the economy.

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