MANILA - After posting the highest growth since November last year, the pace of remittance growth slowed to 2.8% in August.

Data from the Bangko Sentral ng Pilipinas (BSP) showed that money sent home by overseas Filipino workers (OFW) reached $1.369 billion in August from last year's $1.332 billion. The figure is slightly lower than the $1.494 billion recorded in the previous month, when remittances posted a 9.3% growth.

The 9.3% rise in July remittances was the highest growth since the 10.5% recorded in November 2008. For the past months, remittances have been growing by less than 5% as rich host countries slashed jobs and prioritized their own citizens in employment generation efforts due to the global economic crisis.

The August figure brought the country's total remittance inflows to $11.342 billion for the first 8 months of the year, a 3.7% growth from last year's $10.940 billion.

"As recent developments point to improving global economic conditions, a more favorable outlook for remittances through end-2009 is anticipated," BSP Governor Amando Tetangco Jr. said in a statement.

In a briefing on Wednesday, Tetangco said remittance inflows are likely to reach $17.1 billion at the end of the year from the record $16.4 billion in 2008. This, he said, would boost the country's current account surplus and gross international reserves to $6 billion and $43 billion, respectively.

Outlook on remittances has vastly improved since the global crisis hit. In February, the BSP is looking at a flat remittance growth for 2009. The BSP has recently revised it to  4%.

Stronger ties

According to the BSP, stronger ties with host countries, banks, and remittance firms were the main growth drivers for remittances.

During the 8-month period, the country's major source of remittances were the United States, Canada, Saudi Arabia, United Kingdom, Japan, Singapore, United Arab Emirates, Italy, and Germany.

"Providing optimism for the steady flow of remittances in the months ahead are the employment agreements forged between the Philippines and host countries such as Qatar, Saudi Arabia, Canada, Australia, Japan, South Korea, and Taiwan, and the impending major US military base expansion in Guam starting next year," the BSP said.

"Moreover, in the recently concluded 4th Joint Labor Council Conference between the Philippines and Taiwan, labor authorities from the 2 countries have agreed to extend their memorandum of understanding on the Special Hiring Program for Taiwan beyond March 2010," the bank added.

On top of these, the BSP said inflows were supported by the increased access of OFWs and their beneficiaries to formal money transfer channels through the establishment of more remittance centers and tie-ups abroad.

"The commercial banks' continuing aggressive efforts to build up their network of remittance business partners worldwide resulted in the capture of the larger share of the global remittance market. The country's state-owned banks have also started to strengthen their corresponding relationships with remittance companies abroad," the BSP said, quoting Tetangco. -- Text and graphs by Karen Flores, abs-cbnNEWS.com