Dollar remittances hit record high

MANILA, Philippines — The strong finish in December due to the holiday season boosted dollars sent home by Filipinos abroad to  reach an all-time high of $37.2 billion in 2023, the Bangko Sentral ng Pilipinas (BSP) said.

Data from the BSP showed that personal remittances – the sum of net compensation of employees, personal transfers and capital transfers between households – reached $37.21 billion in 2023, three percent higher than the previous year’s $36.14 billion.

The  record-high figure was driven by the $3.63 billion generated in December alone, up by nearly four percent from a year ago.

Rizal Commercial Banking Corp. chief economist Michael Ricafort said there was an expected seasonal surge in remittances from overseas Filipino workers (OFWs) and conversion to pesos during the Christmas holiday season.

“This is to finance the surge, if not the peak, in holiday-related spending, a consistent pattern seen for many years and could seasonally support the peso exchange rate as well,” he said.

Ricafort said the growth in remittances is expected to  continue as Filipino families need to cope with the volatile upswing in commodity prices.

BSP data showed that the full-year increase was also brought about by the 3.1-percent rise in remittances sent by land-based workers with work contracts of one year or more, to $28.9 billion.

Similarly, remittances from sea and land-based workers with work contracts of less than one year also grew by 2.4 percent to $7.5 billion.

“The robust inward remittances reflected the rise in the deployment of OFWs due to the continuous increase in demand for foreign workers in host countries,” the BSP said.

As such, the 2023 remittances accounted for 8.5 percent of the country’s economy and 7.7 percent of gross national income.

On the other hand, cash remittances coursed through banks also improved by 2.9 percent to $33.5 billion in 2023 from $32.5 billion in 2022.

The expansion in cash remittances was due to the growth in receipts from land and sea-based workers.

Cash remittances from land-based workers increased by 3.2 percent to $26.6 billion, while the amount sent home by sea-based workers went up by two percent to $6.9 billion.

“The growth in cash remittances from the US, Saudi Arabia and UAE contributed mainly to the increase in remittances in 2023,” the BSP said.

As to overall remittances last year, the US topped the list with a share of 40.9 percent, followed by Singapore with 7.1 percent and Saudi Arabia with 6.2 percent.

Other top sources include Japan, the UK, UAE, Canada, Qatar, Taiwan and South Korea.