10 January 2008
The strengthening peso has resulted in a sharp cut in overseas Filipino
workers’ (OFWs) incomes, costing them over P700 per $100 remitted,
according to independent think-tank IBON Foundation.
From January to December 2007, the exchange rate of the peso to the
dollar has strengthened by almost fifteen percent. This means that over
the period, the family of an OFW who remitted $100 in January were able
to exchange it for P4,891. By December this had fallen to P4,174 or a
decline of P717.
Such a reduction is especially painful given the increasing prices of
basic goods and services in the country. For example, from January to
November 2007 the cost of an 11-kg liquefied petroleum gas (LPG)
cylinder increased by P76.94 to almost P600. Manila Water also recently
implemented a rate hike that will cost consumers who consume 30 cubic
meters per month an additional P60 on their bills.
“Overseas workers were forced to tighten their belts and remit more of
their income to make up for the lost value,” said IBON research head
Sonny Africa. Monthly remittances grew 26% from P1.1 billion in January
to P1.4 billion in October.
The strengthening peso and its effect on OFWs’ incomes reveals the folly
of the government’s labor export policy and its continuing reliance on
migrant workers’ remittances. (end)