Remittances hit 2024 high of $3.08 billion in July
Money sent home by Filipinos abroad hit their highest level so far this year in July, but an analyst flagged “plateauing” growth of such inflows despite the rising number of expats.
Cash remittances coursed through banks amounted to $3.08 billion in July, up by 3.1 percent compared with a year ago, the Bangko Sentral ng Pilipinas (BSP) reported on Monday.
Figures showed the July reading was a fresh seven-month high. Year-to-date, remittances grew by 2.9 percent to $19.33 billion, consistent with the forecast of the BSP for such inflows to expand by 3 percent in 2024.
“This surge is likely due to factors like economic recovery and improving sentiment, tempering inflation and improved remittance channels,” Robert Dan Roces, chief economist at Security Bank, said.
Respectable
Data showed remittances have been growing at around 3 percent since late 2022, with the BSP projecting the growth of such transfers to settle at that level again in 2024 and 2025.
That said, Jeremaiah Opiniano, executive director at Institute for Migration and Development Issues, believed that remittance growth has “reached a plateau,” adding that higher deployment might not be translating to stronger inflows as major host countries prioritize giving jobs to locals.
“When the record 2023 deployment came … we thought that would lead to some additional [remittance] flows even after these new migrant workers have repaid the loans they accessed to spend for their first migration,” Opininano said.
“But the overseas job markets only have their vacancies to provide for foreign workers; these markets also have to worry about their locals too,” he added.
Purchasing power
Money sent home by Filipinos overseas is a major source of purchasing power in the Philippines, where consumption typically accounts for nearly 70 percent of gross domestic product. That said, a plateauing remittance growth may translate to sub-par support to consumer spending.
But the BSP had said a 3-percent remittance growth was still “respectable,” adding that these inflows are now expected to clock in lower growth rates compared to previous decades as they continue to grow “quite substantially in nominal size.”
