MANILA—As national statisticians and development planners reported the current decline of the country’s gross domestic product for the second quarter this year, the number of overseas Filipinos’ remittances showed that the money sent back home is declining.
According to the inflow of compensation income, an item under Net Primary Income (NPI), that is part of the system of national accounts yielded year-on-year negative growth rates in compensation income for the first two quarters of the year.
According to data from the National Statistical Coordination Board (NSCB), the year-on-year decline was at 3.9 percent for the first quarter and 3.1 percent in the second quarter.
Formerly known as the Net Factor Income from Abroad (NFIA), the NPI covers the difference between the total values of the incomes receivable from (inflows), and payable to (outflows), non-residents of a country.
The NPI includes labor income that covers the compensation of employees paid to non-resident works or, in the case of the Philippines, overseas Filipino workers and their remittances.
The NPI also includes property and entrepreneurial incomes such as investment incomes from owning foreign financial claims such as interest and dividends, and from non-financial property incomes such as patents and copyrights.
With the two successive quarters of negative growth rates of the inflow of compensation income, economist Alvin Ang of the University of Santo Tomas said this affirmed the overall slowdown of overseas Filipinos’ remittances since post-global crisis 2010.
The slowdown in growth rates from overseas Filipinos’ remittances and the inflow of compensation incomes under NPI goes to show that the Philippines continues to miss out harnessing the dividend from Filipinos’ overseas migration, Ang said.
This dividend that Ang is pertaining to the monetary resources from Filipinos abroad, such as savings and investible funds, that the country can harness for local development and job generation.
The NSCB recently said that the country’s gross domestic product (GDP) declined this second quarter of 2011 to 3.4 percent, from 4.6 percent during the first quarter.
Gross national income (GNI), the sum of GDP and NPI, also declined to 1.9 percent this second quarter, from 3.4 percent during the year’s first quarter. The 2011 second quarter GNI growth, says NSCB, “is the lowest growth during the last four years”.
In a statement, NSCB said the decline of NPI factored in “the seething political turmoil in the Middle East and North Africa, plus economic uncertainties in western countries” such as member-countries of the European Union.
There are over 800,000 Filipinos in European countries, while over-1.5 million are in the MENA countries—including strife-torn countries Libya, Tunisia, Egypt, Syria, Oman and Yemen. Saudi Arabia alone has over a million overseas Filipino workers. (OFW Journalism Network)