BSP sees slowdown in OFW remittances in '08

Although fewer Filipino workers are leaving the country to work overseas compared to the previous year, the Bangko Sentral ng Pilipinas (BSP) remains optimistic that dollar remittances from abroad would still increase but on a slower growth pace. The increase would largely be due to the growing preference for highly-paid professionals such as doctors, nurses, and engineers. BSP Governor Amando Tetangco predicted a 5 percent growth in OFW remittances through the formal banking system next year even in view of the decreasing deployment rate. In the first quarter this year, OFW remittances reached $3.5 billion, which is equivalent to a 24 percent growth over the $2.8-billion record in the first three months of 2006. In March alone, remittances grew by 26.4 percent, resulting mainly from competing remittance schemes offered by financial institutions, and enhanced links established with foreign counterparts. "Over the years, financial institutions have continuously forged tie-ups with remittance centers overseas, thus, increasing access to financial services and facilitating transfers by overseas-based Filipinos to their beneficiaries," Tetangco cited. The BSP chief also noted that the profile of workers leaving the country has been changing, with more professionals and higher-paid workers in the field of medical and health care, information technology, education, maritime, hotel and food industries, among others. BSP earlier projected OFW remittances passing through banks to reach $14 billion, up from $12.8 billion in 2006. Next year, the amount of remittances coursed through banks could go up to $14.7 billion, but the aggregate amount could reach $16 billion, including those sent through non-bank channels. BSP estimates that the banks capture as much as 90 percent of OFW remittances to their relatives in the Philippines. The projection, Tetangco said, could still change because it would still be subject to a periodic review, depending on emerging trends of workers' deployment later in the year. Tetangco said BSP is taking a conservative projection of total remittances in 2008 in view of the expected slowdown in the US economy and the resulting slowdown in some of its major trading partners that were also the country's primary labor destination. An earlier study by JP Morgan indicated a similar slowdown in OFW remittances in 2008 due mainly to the base effect of this year's record high remittance level. Even with declining OFW deployment, remittances continued to post significant growth in the first quarter of 2007 compared with last year's deployment level. Tetangco said preliminary data from the Philippine Overseas Employment Administration (POEA) showed that the total number of deployed workers contracted year-on-year by 10.6 percent to 251,009 in the first quarter of 2007. The aggregate numbers of land-based and sea-based workers at 191,937 and 59,072, respectively, were lower by 9.2 percent and 14.8 percent compared to the 2006 levels. The Middle East remains the primary destination of Filipino contract workers, getting the bulk of 68 percent, with Saudi Arabia having the biggest share of almost 30 percent, followed by the United Arab Emirates with 12.5 percent and Taiwan, with 10 percent, based on the 2006 figures from the POEA. The Department of Labor and Employment (DOLE) said the demand for Filipino professionals and skilled workers in Asia remains bright due to the sustained economic growth in the region. Acting Labor Secretary Danilo P. Cruz earlier said the bustling economies of many Asian countries have sustained the construction of major infrastructures and industrial projects, resulting in the steady increase in the demand for foreign workers, including overseas Filipino workers (OFWs). Citing a report from the POEA, Cruz said Taiwan and South Korea, under the latter's Employment Permit System, both remain major destinations for Filipino factory workers. Cruz also noted the emerging markets for foreign IT and health care workers in Taiwan and skilled workers in the construction and ship-building sectors in Korea. He expressed confidence that both countries would provide opportunities to OFWs to fill their manpower requirements in these sectors. He also enumerated the employment opportunities in Singapore, Malaysia, and Brunei. He said that the Philippine Overseas Labor Offices in these countries are exerting efforts to make employment opportunities available to OFWs. Cruz said that Singapore offers bright employment prospects for hotel managers, supervisors, and skilled workers including croupiers, dealers, chambermaids, and waiters/waitresses. The island state is also in need of architects, engineers, and draftsmen for its construction projects. There is also a rising demand for IT and related skills in Penang, Johore, and Kuala Lumpur in Malaysia. At the same time, the construction, ship building and ship repair industries in Johore need skilled workers while Genting Highlands Hotels and Resorts need casino workers and entertainers. In Brunei, industries such as oil and gas, hotels and restaurants, and construction provide employment opportunities for skilled and professional workers such as fabricators, riggers, high-pressure operators, managers, and engineers. - GMANews.TV