Once Again, the OFW Saves the Day for RP Economy

It is undeniable that OFW remittances have kept the ailing economy afloat. Labor migration, once a mere stop-gap measure to tide the economy over in the economic crunch of the ‘70s, has become a major government policy, with the local government units even facilitating the recruitment of OFWs.


It is undeniable that remittances by overseas Filipino workers (OFWs) have kept the ailing economy afloat. Labor migration, once a mere stop-gap measure to tide the economy over in the economic crunch of the ‘70s, has become a major government policy, with the local government units even facilitating OFW recruitment.

Dependence on remittances

Based on the Bangko Sentral ng Pilipinas (BSP or Central Bank of the Philippines) data, the cumulative OFW remittances for the first 10 months of the year soared to US$8.8 billion or 27.1 percent higher than the US$6.9 billion posted in the same period last year. This is even higher than last year’s total remittances of US$8.5 million.

BSP said a significant portion of remittances continue to come from the U.S., Saudi Arabia, Italy, Japan, Hong Kong, United Kingdom, United Arab Emirates and Singapore.

The BSP figures show remittances from OFWs could total some $10.3 billion by end-2005, or 20 percent higher than 2004 inflows.

Migrante International secretary general Maita Santiago, however, said remittances will surpass BSP’s target due to increasing deployment of professional workers for overseas jobs and their unmonitored remittances through informal channels.

The increase in remittances is a positive development for the Arroyo government, which has become dependent on OFW remittances to keep the economy afloat – something even the World Bank (WB) is critical of.

Joachim von Amsberg, one of the authors of World Bank’s 2005 Global Economic Prospects (GEP) released in December, said, referring to the Philippines, “migration should not be viewed as a substitute for economic development in the origin country as ultimately, development depends on sound domestic economic policies.”

The same report noted that more than US$11.6 billion were recorded in remittances to the Philippines, making it the fifth largest recipient in 2004. This figure, which accounted for around 13.5 percent of the country’s gross domestic product (GDP), was the largest share of remittances to GDP among the top five recipient countries.

The countries receiving the biggest recorded remittances are India ($21.7 billion), China ($21.3 billion), Mexico ($18.1 billion), France ($12.7 billion), and the Philippines ($11.6 billion).

Meanwhile, the International Labor Organization (ILO) has a much bigger figure: $21 billion yearly, with about $8.5 billion remitted through official bank channels. ILO recognizes the Philippines as the No. 1 exporter of migrant workers in the world.


Data from the Philippine Overseas Employment Administration (POEA) show the total number of new OFWs in the first 10 months of 2005 increased to 809,140 from 794,806 in the same period in 2004.

POEA points to an average of 2,700 land-based and sea-based OFW departures each day for this year. The POEA even expects the year-end average to reach 3,000 a day, much higher than the 2,500 daily average recorded last year.

Santiago said that if the undocumented workers are included, the daily average could reach up to 3,500 to 4,000 OFWs.

OFWs now account for the 10 percent of the country’s population or about 8.5 million.

This year, Santiago said, more highly-skilled workers and professionals have been deployed. This, said the POEA, led to the 22.1 percent surge in remittances in the first six months of 2005.

Santiago said, however, that many of these professionals work below their degree or training, like the teachers who work as domestic helpers, nurses as caregivers, and doctors as nurses.

Santiago said the government’s target of one million jobs yearly is actually deployment abroad.

It must also be noted that government profits from the fees being charged to OFWs. An OFW applicant pays an average of P17,925 in government fees before he or she leaves the country. This does not include the astronomical charges of recruitment and manning agencies.

OFW woes

Santiago bewails that OFWs have saved the country from economic collapse because of their remittances but when they are having problems, the government could not do anything to protect them.

Santiago said that since she joined Migrante in 1999, it is in 2005 that she has received the most number of text messages from stranded OFWs and those on death row.

She said there are mornings when she would read text messages from Rey Cortez or Rodelio “Dondon” Lanuza, both on the death row in Saudi Arabia. Lanuza in fact texts her in the wee hours of the night expressing fears that he would be hanged next. Lanuza was meted the death penalty in 2002 for allegedly killing a Saudi national who tried to sexually harassed him.

The Office of the Undersecretary for Migrant Workers Affairs (OUMWA) is presently monitoring 25 death penalty cases involving OFWs. This figure excludes “potential” death penalty cases, where trial is still on-going or the conviction is not yet final.

Migrante reports that four Filipinos have already been executed as of March 14 in Saudi. They were Sergio Aldana, Miguel Fernandez Jr., Wilfredo Bautista and Antonio Alvesa.

Meanwhile, based on the DFA records, at least 4,775 Filipinos were in detention as of end of 2004, mainly for violation of immigration laws. Of these, 1,103 were women.

Of the 82 Philippine diplomatic posts abroad, only 12 reported having no Filipino detained or awaiting trial in their area of jurisdiction.

Migrante also reported an increase in the number of “mysterious deaths” of OFWs. Based on its records, at least 18 cases of OFWs who were victims of “mysterious deaths” abroad had remained unsolved since President Gloria Macapagal-Arroyo assumed presidency in 2001. At least seven occurred in 2005.

One was the case of domestic helper Ivy Collantes Bautista who was found dead Sept. 27 in her employer’s residence in Santander, Cantabria, Spain. Bautista’s body was found with a kitchen knife still lodged in her neck, a slash wound on her chest, and bruises on different parts of her body. The Spanish police, however, said Bautista committed suicide.

Santiago also said that, like the “mysterious deaths,” rape cases have remained unsolved. Worse, she said, there have been reports that Filipino officials assigned in countries where many of the cases took place, have not been of help to the victims.

The group also scored the Macapagal-Arroyo administration’s inability to seek justice for the victims. Santiago said Migrante usually writes to the DFA about these cases and the DFA simply receives the letters and does nothing more.

Meanwhile, crackdowns against undocumented Filipinos also came left and right in various countries, including Malaysia, Japan, Oman and Brunei.

Meanwhile, early this year, Japan amended its Immigration Control and Refugee Recognition Act and imposed stiffer entry requirements for “overseas performing artists”.

Santiago said these new policies may have resulted in an even greater number of undocumented workers, greater incidence of trafficking and heightened exploitation for Filipino migrants in and bound for Japan.

Based on Migrante’s records, more than 300,000 Filipinos, including an estimated 77,000 undocumented workers, are affected by Japan’s new policies.

No economic comfort

Despite the abuses against the OFWs and the alleged abandonment of the Philippine government, Filipinos are still enticed to work abroad in the hope of achieving a more comfortable life for them and their families.

On the contrary, Santiago said, many OFWs are forced to accept low-paying and difficult jobs, like in Saudi which offers as low as US$100-150 per day for unskilled workers, because locals of these countries refuse to do these works.

OFWs endure wage cuts, lack of benefits or absence of day-offs just to send any amount of money to their families in the Philippines. Although there are countries that offer higher salaries, like the UK and the U.S., Santiago said the cost of living in those countries are also high.

Meanwhile, the cost of living in the Philippines is also rising, lowering the real value of their remittances. Based on data from the National Wages and Productivity Commission (NWPC), the daily family living wage for a family of six – the average Filipino family – amounts to a nationwide average of P667.20 as of last September. This is P126.60 higher than last year’s national average of P540.60.

Conversely, the minimum wage stands at a national average of only P222.93 daily as of last June, or P444.27 less than the P667.20 national average family living wage for a family of six. The National Capital Region (NCR) has the highest regional minimum wage rate at P325 – as opposed to its family living wage rate of P681 as of last September.

According to the National Wages and Productivity Commission (NWPC), the family living wage in the National Capital Region (NCR) as of October 2005 amounts to P20,520 a month.


Santiago pointed out how the Macapagal-Arroyo administration has never hidden its dependence on OFWs, with bigger OFW deployment a major target in its national development strategy.

When the hiring of Filipino domestic helpers by Hong Kong employers declined last year due to stiff competition from the Indonesians, Labor Secretary Patricia Sto. Tomas reportedly called it “saddening, but not alarming.”

To prepare for 2005, the Department of Labor and Employment (DoLE) initiated the first international forum on labor opportunities abroad held at the Philippine International Convention Center (PICC) in September last year. It brought together major players in the international labor market, tackling employment opportunities for Filipino workers.

To attract more OFWs, DoLE has made local government units (LGUs) conduits in the recruitment and deployment of OFWs in their respective provinces.

The DoLE’s Public Employment Services Office (PESO), which is supposed to offer local employment, would now focus on overseas job placement.

Meanwhile, Santiago is alarmed at Sto. Tomas’ statement last November that the government is willing to accept wages below the minimum level for OFWs in some unskilled occupation.

Santiago said that the labor department has agreed to special arrangements for Filipinos in regions that are most depressed.

In Mindanao, particularly Davao City, the POEA has been offering “free deployment” assistance to female OFWs willing to work in Kuwait and Saudi Arabia. Through its “Special Employment Program for Mindanao”, the government will shoulder the expenses for placement, passport processing, training, medical and airfare. The chosen applicants will however only receive a monthly salary of P8,400 compared to the usual P11,200 minimum wage in Kuwait.

In Sarangani, the provincial government has decided to adopt the “Fly Now, Pay Later Program”, allocating P1.1 million for assistance to jobseekers from their province.

With these schemes, it is not surprising then that Mindanao topped the country’s deployment of women workers abroad over the last three years, with Region 12 or the Soccsksargen leading over the island’s six regions.

On the other hand, a National Statistical Coordination Board (NSCB) report in Region 12 said six out of 10 OFWs coming from Mindanao are women, compared to only four in Luzon and Visayas. (Region 12 covers the provinces of South Cotabato, Sarangani, Sultan Kudarat, (North) Cotabato and the cities of Koronadal, General Santos, Tacurong, Kidapawan and Cotabato.)

According to the Overseas Workers Welfare Administration, Soccsksargen Region currently has more than 500,000 OFWs deployed either as skilled or professional workers.

“Migration is the reflection of intensified crisis in the country,” Santiago said. And in this condition, she said, the welfare of OFWs are being neglected and sacrificed “in the name of higher remittances and more market for OFWs.”

But Santiago believes that the worse is yet to come. She said it could arrive at a “raise to the bottom” state. Bulatlat.com

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