Philippines: Remittances maintain solid growth
August 15, 2011
In June, remittances from Overseas Filipino Workers (OFW) rose 7.0% over the same month last year to USD 1.74 billion. The pace of expansion was virtually unchanged from the 6.9% growth tallied in May. In the second quarter of the year, remittances amounted to USD 5.0 billion, which was 6.7% higher compared to the same period of the previous year, when remittances totalled USD 4.7 billion. Remittances account for approximately 9% of GDP and are an important source of income for many Filipino families. Given its significance in the economy, OFW funds sent from abroad are a key driver of private consumption. Moreover, the steady flow of remittances supports the local currency. According to the Central Bank, some 76% of remittances were sent from the United States, Europe and the Middle East. Given the deteriorating prospects for the U.S. and Eurozone economies, remittances are likely to grow less dynamically going forward.