Money sent home by more or less 10 million overseas Filipino workers (OFWs) pushed past record-high remittances set in 2013, and rounded 2014 with cash remittances 5.8 percent higher to $24.31 billion, the Bangko Sentral ng Pilipinas (BSP) said on Monday.
The new record broke expectations that overseas remittances, an important growth driver for the consumption-led Southeast Asian economy, would expand by up to only 5 percent during the period.
According to the BSP, the full-year performance was highlighted by remittances aggregating $2.32 billion in December, also higher by 9.4 percent from remittances totaling only $2.12 billion a year earlier.
The continued resilience of overseas remittance flows viewed against a backdrop of a slowing global economy in 2014 contrasted starkly against remittances the previous November, when this totaled only $2.12 billion, itself representing a five-year low, based on BSP data.
The central bank welcomed the still-resilient remittance flows and acknowledged the overseas earnings of migrant workers and those other Filipinos abroad who regularly send a portion of their earnings back to the Philippines are an integral part of the $270-billion economy.
“The robust growth of overseas Filipinos’ remittances continued to provide support to the country’s economy, with cash remittances accounting for 8.5 percent of gross domestic product [GDP] in 2014,” the central bank said.
The bulk of the cash remittances during the year flowed from the United States, the United Arab Emirates (UAE), the United Kingdom, Singapore, Japan, Hong Kong and also from Saudi Arabia no matter the apprehension over the economic impact of declining oil prices affecting these countries.
The central bank also said the cash remittances grew in both land- and sea-based Filipino workers during the year.
In particular, remittances from land-based workers aggregated $18.7 billion, while remittances from sea-based workers totaled $5.6 billion.
The BSP said the strong demand for skilled Filipino manpower abroad contributed to the steady growth of remittances for 2014, citing Philippine Overseas Employment Administration’s (POEA) data of a total of 1.6 million deployed OFWs in end-2014.
Also, the BSP cited the 10.7-percent growth in job orders for the year, totaling 878,609 approved job positions in 2014. Some 43.6 percent of the processed job orders were for services, production and professional, technical and related worker requirements in Saudi Arabia, Kuwait, the UAE, Taiwan and Qatar.
Also, the BSP noted the banks’ tie-ups with so-called remittance centers contributed to the steady remittance growth for the period. The central bank said there were some 4,765 commercial bank tie-ups, remittance centers, correspondent banks and branches or representative offices abroad as of end-2014.
Personal remittances, meanwhile, which are remittances involving transfers both in cash and in kind, as well as capital transfers between households, also hit a record high in December last year totaling $2.6 billion, pushing the full-year personal remittance growth of $26.9 billion in 2014. This was 6.2 percent higher than the personal remittances seen in the comparable period in 2013.