OFW fund may not shield RP from recession in US

MANILA, Philippines - Remittances from overseas Filipino workers (OFW) may no longer save the Philippine economy from being affected by the US economic recession, according to a local debt watchdog. The Freedom from Debt Coalition (FDC) on Monday said OFW remittances “are being threatened" by the continuing downturn in the US economy because most Filipino migrants work in countries that are largely affected by what has been described as the worst financial crisis in decades. According to FDC trustee Maitet Pascual, even when OFW remittance still serves as the country’s economic “lifeline," OFWs are now more vulnerable to economic slump because many of them are located in the US and in other countries such as Japan and those in Europe that are also seen reeling from the “global financial flu." Pascual said such situation could weaken remittances into the Philippines, and might even result in the massive deportation of OFWs. She said OFW groups “most vulnerable" to the crunch would be undocumented Filipinos in crisis-hit nations, as well as seamen who are dependent on trade. Pascual said a weakening trade would render lower demand for shipping, and therefore would lower demand for seamen. Pascual said that “without OFW remittances, the Philippines will still be incurring negative balances in its current account." The impact of the US recession will likely be more on the real economy, such as labor and goods export, rather than in the Philippines’ financial system or debt and borrowing, according to Pascual. She said that the financial crunch could possibly lead to weak demand from major trading partners, which could translate to weakened exports despite the depreciating peso. - GMANews.TV