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Remittances drop for 2 straight months

Dollar remittances by Filipinos dropped again in April, for the second consecutive month, due to the COVID-19 pandemic, according to the Bangko Sentral ng Pilipinas (BSP).

The BSP attributed the decline to broad labor cutbacks overseas and the repatriation of Filipino workers from jobs abroad.

Personal remittances from overseas Filipinos amounted to $2.276 billion in April 2020, which was 16.1% lower than the $2.713 billion recorded in April 2019.

The BSP said in a statement, “The decline in cash remittances was attributed to the unexpected repatriation of some overseas Filipinos deployed in countries heavily affected by the pandemic, and temporary closure or limited operating hours of some banks and institutions from both the sending and receiving ends that provide money transfer services during the lockdown.”

Lower remittances was first reported in March due to labor cutbacks in Saudi Arabia, United Arab Emirates and Kuwait where demand for workers was affected by depressed oil prices in the world market.

The April figures brought the cumulative remittances for the first four months of the year to $10.494 billion, a drop of 2.9% from the $10.811 billion recorded in the same period in 2019.

Personal remittances from land-based workers with work contracts of one year or more declined to $1.677 billion in April 2020, or 17.9% lower than US$2.043 billion recorded in April 2019.

Remittances from sea-based workers and land-based workers with work contracts of less than one year fell by 10.2% to $547 million in April 2020 from $609 million a year ago.

Overseas Filipino cash remittances that are coursed through banks declined by 16.2% to $2.046 billion in April 2020 from $2.441 billion in April 2019.

For the January–April 2020 period, cash remittances amounted to $9.448 billion, 3% lower than the $9.739 billion registered in the comparative period last year.

This developed as remittances of both land-based and sea-based workers, fell by 3.5% to $7.335 billion from $7.597 billion, and 1.3% to $2.114 billion from $2.142 billion, respectively. The BSP earlier warned that Filipino remittances will contract for the first time in almost two decades — estimated at shrinkage of 3% by the end of this year — due to laborer repatriations caused by the pandemic, but will likely see a 4% rebound next year.

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