Remittances to keep growing, says HSBC
Remittances to the Philippines are expected to keep growing despite recent political upheavals, such as the unrest in the Middle East.
This was according to investment bank HSBC, which said that the profile of Filipinos working abroad has changed over the past few years, and this would likely lead to sustained growth in remittances sent to the Philippines.
“There are more and more overseas Filipinos with white-collar jobs, such as doctors and other professionals. This structural change is expected to continue supporting growth in remittances,” said Arjuna Mahendran, HSBC managing director and investment strategy head for Asia.
Mahendran said the unrest in some countries in North Africa and the Middle East, where a considerable number of overseas Filipino workers reside, is indeed affecting the amount of money sent home by Filipinos based there.
However, he said that the adverse impact is more than offset by the deployment abroad of more Filipino white-collar workers, who get higher pay compared with blue-collar workers.
Thus, the total amount of remittances continues to grow.
According to the latest report by the Bangko Sentral ng Pilipinas, remittances to the Philippines amounted to $6.2 billion in the first four months of the year, up by 6 percent from $5.9 billion in the same period last year.
The BSP projects growth in remittances to slightly accelerate in the months ahead to post a full-year growth of 7 percent.
Remittances have played a significant role in the economy’s growth over the years as these help boost household consumption, which is a key growth driver.
Critics said, however, that growing remittances indicate the lack of employment opportunities in the country.
The government acknowledges that the deployment of Filipinos overseas has its adverse effects, which is why it is drafting a medium-term plan to develop investment opportunities here for Filipinos working overseas.
According to the Commission on Filipinos Overseas, the proposed income-generating programs are designed to encourage some Filipinos abroad to eventually go back home.