BSP Reports Record Highs From Overseas Remittances in the Philippines

In December 2023, personal remittances from overseas Filipinos achieved a record high in the Philippines, reaching US$3.6 billion, an increase of 3.9% from the US$3.5 billion reported in December 2022.

This growth, as detailed by the Bangko Sentral ng Pilipinas (BSP), was fuelled by enhanced remittances from both land-based workers engaged in contracts of a year or more and those in sea- and land-based roles with shorter contracts.

Over the course of the year, personal remittances ascended to a record US$37.2 billion, marking a 3% rise from US$36.1 billion in the previous year.

This elevation in remittances, accounting for 8.5% and 7.7% of the Philippines’ Gross Domestic Product (GDP) and Gross National Income (GNI) respectively, underscores the vital role of overseas Filipino workers in the economic framework of their country.

Source: BSP

Examining the details, cash remittances processed through banks in December 2023 alone amounted to US$3.3 billion, up by 3.8% compared to US$3.2 billion in December 2022. Throughout 2023, cash remittances totalled US$33.5 billion, showing a growth of 2.9% from 2022, with the United States, Saudi Arabia, and the United Arab Emirates being significant contributors.

The largest share of remittances originated from the United States, followed by Singapore and Saudi Arabia, reflecting the extensive support OFs extend to their families back home.

Source: BSP

The continued increase in remittance inflows has been highlighted to the Philippine Daily Inquirer by Nicholas Mapa, senior economist at ING Bank in Manila, who attributed this growth partly to the favourable exchange rate of the peso against the US dollar and the improved employment opportunities for Filipinos overseas as the global economy recovers from the pandemic.

Nicholas Mapa

“Remittance flows continue to grow at a very robust and consistent, roughly 3-percent pace, helped along by the steady deployment of workers and sustained expansion of host countries,”

Nicholas said.

Jeremaiah Opiniano

In addition, Jeremaiah Opiniano, executive director at the Institute for Migration and Development Issues, noted that the rising cost of living in the Philippines, coupled with inflation in host countries, has likely influenced Filipinos abroad to increase remittance volumes, aiming to compensate for the economic downturn caused by the pandemic on their families.

“Inflation may have also been felt in other countries, so you wonder if overseas Filipinos are again doing sacrifices for the sake of their families,”

Jeremaiah added.

The BSP anticipates a steady growth rate of 3% in cash remittances for the upcoming year, reflecting the ongoing significance of these financial inflows to the Philippine economy. This expectation is supported by the assessment that the growth in remittances will continue to provide essential foreign exchange while supporting domestic consumption through the purchasing power of the peso.