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Higher OFW remittance double-edged sword, says economist


MANILA, Philippines - Despite the double-digit level climb of overseas Filipino workers (OFW) remittances, an economist fears that the Philippine government would become too dependent on OFW money, which if mishandled could easily run out. Ateneo de Manila University economics chairperson Dr. Fernando Aldaba told GMANews.TV on Tuesday that the government should start investing the OFWs’ hard-earned money on infrastructure and basic services before the money runs out. “We have to find ways to re-channel remittances like bonds for infrastructure," he said. Data from the Bangko Sentral ng Pilipinas (BSP) showed that inflows from abroad stood at $1.366 billion in July, 24.6 percent higher than the remittances in the same month last year. This brings the seven-month remittances to a total of P$9.608 billion, 18.2 percent higher than the aggregate inflows from January to July 2007. According to Aldaba, high monthly OFW remittances do not always come with positive effects to the country. “It’s a double-edged sword. While remittances are good for the economy in improving industries like telecoms and real estate, there is a tendency for too much dependence," he said. Aldaba suggested that the government must pool its resources and create an explicit policy on labor migration. An explicit labor policy, Aldaba explained, would define the government’s strategies in the training of OFWs as well as the controlled deployment of Filipino labor to other countries. “If we had more foresight in the past, we could have trained more health workers so that we wouldn’t have a shortage now," he said. Aldaba, however, said that an explicit labor policy is concurrent to the Philippine government’s admittance that it has failed in providing jobs for Filipinos in the country. In a statement, BSP Governor Amando M Tetangco said the rise of remittances may be attributed to foreign companies' preference for Filipino employees, who are highly skilled and proficient in English. From January to August this year, a total of 884,907 Filipinos went overseas for employment, which is a 26.4 percent increase from 699,937 in the same period last year. The Philippine Overseas Employment Agency is optimistic that the number of Filipinos deployed abroad would reach 1.1 million by year end. - GMANews.TV
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