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MANILA - (UPDATE 2, 11:27 p.m.) Money sent home by overseas Filipino workers rose 5.4 percent year-on-year at the start of the third quarter, the Bangko Sentral ng Pilipinas said on Monday.
On the sidelines of the Philippine Economic Briefing, BSP Governor Amando M. Tetangco Jr. said remittances rose to $2 billion in July, helping push the seven-month tally to $13.28 billion, or 5.3 percent higher year-on-year.
“I think it would be more realistic to stick to the five percent growth target. Even if its growth is slightly above, this was not significantly above the forecast,” Tetangco told reporters.
“In terms of the growth rate, it may pick up but it will not pick up that much,” he said.
Forecast remittance growth this year took into account the slowdown in the US and the sovereign debt crisis in the euro zone where a significant volume of personal remittances originate.
Aurelio R. Montinola III, president of Bank of the Philippine Islands, said the growth of money sent home by OFWs would ease to the low single-digits in the next 4-5 years as more higher-paying jobs are created in the country, particularly in the business process outsourcing and tourism sectors.
“Eventually, the remittances will plateau and likely grow at a low single-digit rate. But that is still $20 billion worth of foreign earnings a year,” Montinola said. BPI cornered 27 percent of the remittance business last year.
“The BPOs are providing job opportunities and hopefully tourism will provide it as well,” he said, without citing actual numbers.
Besides BPOs and tourism, manufacturing also is showing good job creation prospects, Montinola said, adding that employment abroad in contrast would diminish amid the global slowdown.
Remittances have helped fuel consumer spending, which comprised over three-fourths of the Philippine economy and lifted growth to a better-than-expected 6.4 percent in the first quarter of this year.
Also on the sidelines of the Philippine economic managers' briefing, Socioeconomic Planning Secretary Arsenio Balisacan said consumer spending would remain a driver of economic growth this year.
He said Philippine gross domestic product would grow at the upper end of the government's target range of 5-6 percent.
With a report from Krista Angela M. Montealegre
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