OFW Remittances Hit All-Time High USD37.2 Billion In 2023

Personal remittances from Filipinos abroad reached an all-time high of USD37.2 billion in 2023, up by three percent compared to USD36.1 billion in 2022, the Bangko Sentral ng Pilipinas (BSP) said.

The BSP noted that the full-year 2023 remittances accounted for about 8.5 percent of the country’s gross domestic product and 7.7 percent of the gross national income. I Photo: Aboitiz Eyes

The BSP emphasized, "The robust inward remittances reflected the rise in the deployment of Overseas Filipino Workers (OFWs) due to the continuous increase in demand for foreign workers in host countries."

It noted that the full-year 2023 remittances accounted for about 8.5 percent of the country’s gross domestic product and 7.7 percent of the gross national income.

Cash remittances coursed through banks reached USD33.5 billion last year, higher by 2.9 percent from USD32.5 billion in 2022, the BSP said, adding that, "The growth in cash remittances from the United States, Saudi Arabia, and United Arab Emirates (UAE) contributed mainly to the increase in remittances in 2023."

It further pointed out that the US had the highest share of overall remittances during the period, followed by Singapore, Saudi Arabia, Japan, and the United Kingdom.

Remittances from OFWs have consistently been the fourth largest in the world after India, Mexico, and China, according to Mr. Michael Ricafort, chief economist of Rizal Commercial Banking Corporation (RCBC).

He highlighted that this is a sign of resilience and has always been a major growth driver for the Philippine economy for many years.

"It is important to note that OFW remittances and conversion to pesos seasonally increased in the fourth quarter especially, during the Christmas holiday season towards the end of the year, especially within a week before Christmas to finance the surge, if not the peak, in holiday-related spending," he said.

"This is a consistent pattern seen for many years and could seasonally support the peso exchange rate as well," he added.

Ricafort projected that the modest growth in OFW remittances could continue in the coming months as OFW dependents still need to cope with higher prices that would require sending more remittances.

He said that a seasonal increase in OFW remittances will be seen around July to August due to the changes at the start of the school year.

But risks of an economic slowdown in the United States, softer economic growth in China and other European countries, and the Israel-Hamas conflict could slow down employment opportunities for some OFWs, Ricafort said.

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