MANILA, Philippines — The increase in the amount of money sent home by overseas Filipinos to their loved ones in the Philippines accelerated in May, with both cash and personal remittances hitting their highest levels in five months, according to the Bangko Sentral ng Pilipinas.
BSP Governor Benjamin Diokno said personal remittances grew faster at 5.5 percent in May from April’s 3.7 percent to hit a five-month high of $2.89 billion.
The latest inflow was the highest since the $3.16 billion recorded in December.
For the first five months, Diokno said personal remittances – composed of cash and non-cash items that flow through both formal or via electronic wire and informal channels such as money or goods carried across borders – rose by 4.1 percent to $13.71 billion from $13.17 billion in the same period last year.
Diokno said the steady growth in personal remittances from January to May was driven largely by remittance inflows from land-based overseas Filipino workers with work contracts of one year or more.
This particular group remitted $10.5 billion from January to May, 2.9 percent higher than last year’s $10.2 billion.
Likewise, Diokno said compensation of sea-based workers and land-based workers with short-term contracts also contributed to the growth, rising 7.4 percent to $2.9 billion from $2.7 billion.
On the other hand, the BSP chief said cash remittances coursed through banks increased by 5.7 percent to $2.61billion in May from $2.47 billion in the same month last year.
This was slower than the four percent increase recorded last April and the amount was the highest since $2.85 billion in December.
From January to May, cash remittances went up by 4.5 percent to $12.35 billion from $11.82 billion in the same period last year.
Remittances from land-based workers went up by 3.2 percent to $9.7 billion, while inflows from sea-based workers rose by 9.2 percent to $2.7 billion in the first five months.
According to Diokno, the US registered the highest share of overall remittances in the first five months, followed by Saudi Arabia, Singapore, United Arab Emirates, the United Kingdom, Japan, Canada, Hong Kong, Qatar and Kuwait.
“The combined remittances from these countries accounted for 78 percent of the total cash remittances from January to May 2019,” the BSP chief said.
The BSP has retained the growth target for both personal and cash remittances at three percent for this year.
Remittances usually fuel personal consumption, helping sustain a steady economic growth. The amount of money sent home by overseas Filipinos usually account for 10 percent of gross domestic product (GDP).
Strong inflows from remittances, earnings of the business process outsourcing (BPO) sector as well as tourism receipts continued to boost the peso that recovered strongly late last year.
Diokno is confident that the country would achieve its GDP growth target of between six and seven percent this year after slowing down to 6.2 percent last year from 6.7 percent in 2017.
The GDP expansion slowed to its slowest level in four years at 5.6 percent in the first quarter of the year from 6.3 percent in the fourth quarter of last year due to the delayed passage of the 2019 national budget.