Slowdown in remittances expected to continue

REMITTANCES from overseas Filipino workers (OFWs) in the Middle East might take time to recover even with a US-Iran peace deal, considering the significant impact of the war on the region, an expert said.

- Katherine K. Chan

Jeremaiah M. Opiniano, executive director of the Institute for Migration and Development Issues, said the Philippines should brace for a potentially prolonged slowdown in remittance growth as the economic fallout from the Middle East conflict continues.

“We should brace for it, simply because we have yet to feel the real economic impacts of the Middle East conflict in individual Arab host countries,” Mr. Opiniano told BusinessWorld in an e-mail.

This came after OFW remittances climbed by 2% year on year to an 11-month low of $2.718 billion in April, marking the weakest annual growth in nearly four years or since the 1.8% in May 2022.

According to Mr. Opiniano, the recent remittance slowdown was partly due to drags from the Middle East conflict, although global remittance flows are also historically slow between March and April.

“For now, we can see repatriations from some workers there since they were terminated when some businesses got hit by the missile attacks,” Mr. Opiniano said.