Philippines: Remittances strong but slower than previous month
November 15, 2013
In September, remittances from Overseas Filipino Workers (OFW) increased 5.3% over the same month last year, reaching USD 1.9 billion. The print was below the 6.8% expansion observed in August. The upward trend continues, with remittances adding USD 22.3 billion in the 12 months up to September (August: USD 22.2 billion). This represents a 6.5% expansion over the same period last year (August: +6.6% year-on-year).
The Central Bank stated that remittances continue to be driven by, "steady demand for skilled and professional Filipino manpower." In addition, continued improvements in transaction services offered by banks and non-banks have helped boost remittance flows. Remittances, which account for approximately 9.0% of GDP, are an important source of income for many Filipino families and thus a key driver of private consumption. Remittances are expected to increase significantly in the coming months in response to the devastating typhoon that struck the Philippines in early November.
FocusEconomics Consensus Forecast panelists expect private consumption to grow 5.3% in 2013, which is down 0.1 percentage points from the previous month's projection. For 2014, the panel expects private consumption to expand 5.4%, which is also down 0.1 percentage points from last month's forecast.
Author: Carl Kelly, Economist