Bangko Sentral ng Pilipinas (BSP) Reported Personal Remittances in June Recover after 3 Months of Decline to Reach US$15.6 Billion in H1 2020

MANILA, Philippines, Aug. 18, 2020 /PRNewswire/ -- Bangko Sentral ng Pilipinas (BSP) reported that the total decline in cash remittances for the period January-June 2020 was reduced to 4.2 percent from a cumulative contraction of 6.4 percent in May 2020. This is due to the 7.6 percent growth of personal remittances from overseas Filipinos (OFs) in June 2020, which grew to US$2.737 billion, up from US$2.545 billion in June 2019. This trend is a reversal from three consecutive months of decline from their comparable levels last year. The growth was attributed to the 14.2 percent rise in remittances from land-based workers with work contracts of one year or more to US$2.164 billion in June 2020 from US$1.896 billion in June 2019. Meanwhile, remittances mainly from sea-based workers fell by 13.1 percent from US$593 million posted a year ago to US$515 million in June 2020.

Similarly, OF cash remittances that are coursed through banks rose by 7.7 percent to US$2.465 billion in June 2020 from US$2.29 billion in June 2019, supported mainly by remittances from land-based workers. The continued drop in sea-based workers' remittances was due to the repatriation of many sea-based workers amid the ongoing COVID-19 pandemic. By type of worker, cash remittances from land-based and sea-based workers for January-June 2020 continued to be lower compared to their levels in 2019 by 4 percent to US$10.959 billion from US$11.411 billion, and 5.2 percent to US$3.06 billion from US$3.228 billion, respectively.

By country source, remittances for January-June 2020 from the United States, Japan, Singapore, Oman and Taiwan were among the countries that registered continued growth, while declines were noted in Saudi Arabia, UAE, Kuwait, Germany and the UK. The highest share to total OF remittances at 39.7 percent for January - June 2020 emanated from the US, followed by Singapore, Saudi Arabia, Japan, the United Kingdom, United Arab Emirates, Canada, Hong Kong, Qatar, and Taiwan.[1] The combined remittances from these countries accounted for 78.9 percent of total cash remittances.

[1] There are some limitations on the remittance data by source. A common practice of remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the U.S. Also remittances coursed through money couriers cannot be disaggregated by actual country source and are lodged under the country where the main offices are located, which, in many cases, is in the U.S. Therefore, the U.S. would appear to be the main source of OF remittances because banks attribute the origin of funds to the most immediate source. The countries are listed in order of their share of cash remittances, i.e., from highest to lowest.

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