Remittances climb for the third straight month in November

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(FILE PHOTO)

Metro Manila (CNN Philippines, January 14) — Filipinos abroad sent more money to the Philippines in November amid the global COVID-19 crisis, the Bangko Sentral ng Pilipinas said Thursday.

November 2020 remittances are up 0.1% for the month at $2.64 billion (about ₱127 billion), matching the previous year's level.

This marks the third straight month of higher amount sent home to the families of overseas Filipinos, but is the lowest haul since May when compared to previous months.

Remittances peaked in October at $3.04 billion (about ₱146 billion), prior to the usual surge in money transfers by December for holiday celebrations.

The central bank said land-based workers who have long-term contracts led the increase, sending $2.01 billion home. This offset the 0.3% decline in the amounts wired by seafarers and short-term overseas Filipino workers, which settled at $575 million for the month.

For the past 11 months, personal remittances from Filipinos abroad hit $29.988 billion (about ₱1.4 trillion), down 0.9% year on year.

BSP Governor Benjamin Diokno pointed out that this is far better than the central bank's own forecast of a 2% decline, as well as market forecasts that remittances will slump by a double-digit pace this year due to the pandemic.

The November increase in remittances came even after more than 300,000 OFWs flew home due to the pandemic. 

Remittances are a big source of disposable income among Filipino families, as the dollars sent home provide for food, daily expenses, school fees, and luxuries of their loved ones at home. This boosts household spending and supports economic activity, which has slumped due to local lockdowns.

Major sources of remittances were the United States, Singapore, Qatar, Oman, Hong Kong, and Taiwan, the BSP said. Meanwhile, Filipinos based in Saudi Arabia, Japan, the United Kingdom, the United Arab Emirates, Germany, and Kuwait sent less money. These are among the countries which have reported a second wave of infections in the past few months.

ING Bank senior economist Nicholas Antonio Mapa said he expects the "modest" remittance gains to persist in 2021, but could gradually improve after last year's slump.

The central bank sees a 4% growth in 2021 remittances, matching the pre-pandemic annual pace.