Remittances fell 4.7 percent in March to $2.397 billion from $2.514 billion a year ago, the first decline in nine months, as the deployment of overseas Filipino workers was adversely affected by the coronavirus pandemic, data from the Bangko Sentral ng Pilipinas show.
The figure brought cash remittances in the first quarter to $7.403 billion, up by 1.4 percent from $7.299 billion in the same period last year.
“The decline in cash remittances in March was largely due to the lesser number of Filipinos deployed overseas relative to the comparable level last year,” the BSP said in a statement.
It said the countries that registered lower cash remittances in March were mostly oil-producing countries such as Saudi Arabia, the United Arab Emirates and Kuwait where demand for workers was affected by depressed oil price in the world market.
The BSP said the slight growth in remittances of 1.4 percent in the first three months was supported by inflows from both land-based and sea-based Filipino workers ($5.79 billion and $1.613 billion, respectively), which increased by 1.3 percent and 1.8 percent, respective from a year ago.
The United States posted the highest share to overall remittances at 39 percent in March 2020. It was followed by Singapore, Saudi Arabia, Japan, United Kingdom, UAE, Qatar, Canada, Hong Kong and Korea. The combined remittances from these countries accounted for 79.1 percent of total cash remittances.
Personal remittances, which include non-cash items, also posted its first decline in nine months at 5.2 percent to $2.652 billion from $2.796 billion a year ago. This brought personal remittances in the first quarter to $8.218 billion, up by 1.5 percent from $8.098 billion in the same period last year.
Personal remittances from land-based workers with work contracts of one year or more declined 6.7 percent in March to $2.014 billion from $2.157 billion a year earlier.
Meanwhile, remittances from sea-based workers and land-based workers with work contracts of less than one year rose 2.7 percent to $591 million from $575 million a year ago.
BSP Governor Benjamin Diokno said Thursday that remittances might contract by 5 percent this year, a reversal of the 3-percent growth forecast made in November 2019.
“This is due mainly to large repatriation of workers and major economic disruptions in host countries. [But] remittances are expected to bounce back by a 4-percent [growth] in 2021,” Diokno said.
He earlier expressed optimism that remittances would recover from the adverse impact of COVID-19 pandemic. In his presentation titled “Transitioning Towards the New Economy Post-Covid” during an online forum, Diokno said remittances had been on a steady growth path in recent years and contributed to domestic economic expansion.
He said the BSP was closely monitoring the latest reports from the Philippine Overseas Employment Administration, Department of Labor and Employment and the Foreign Affairs Department on the deployment of OFWs, displacement and repatriation status.
Diokno cited the latest report from the World Bank, saying that global remittances might decline by about 20 percent in 2020, with inflows to East Asia and Pacific expected to slow down by 13 percent, due mainly to the lower inflows from the United States, the largest source of remittances to the region.
Cash remittances rose 4.1 percent in 2019 to an all-time high of $30.133 billion from $28.94 billion in 2018.