OFWs mull reduction of remittances to the Philippines

It took time before tens of thousands of Filipino overseas workers and immigrants have experienced the negative impacts of the weakening dollar in the pockets of the dollar earners abroad. Although this development was viewed by the government as a manifestation that the peso is getting stronger under the administration of President Arroyo.

Bankers and financial analysts have reasoned out that the sagging dollar value was attributed to the influx of huge volume of dollar remittances from the millions of OFWs worldwide in time for the Christmas holidays.

In Southern California alone, where many Filipino immigrants live, remittance centers like RCBC, PNB and the Western Union are busy entertaining the increasing number of remittances intended for the Philippines. And the administration is reaping much of the credit for posting a never expected GDP growth in years since she took the rein of power from former President Joseph Estrada, now a free man.

For how long this will last, nobody can tell at the moment except that remittances will continue to flood the currency market thereby boosting and strengthening the financial system once more. But economists have criticized the government for taking the credit. After all, there is nothing we can do about it because Filipinos have no alternative but to send money to their loved ones in the Philippines, says an immigrant who frequents the Western Union outlet in Carson.

And the only way to bring back the value of the dollar to its former robust health is to reduce the flow of dollars into the country. Once the dollar remittances are controlled, supply of the foreign currency is constricted and the demand for dollars will surely go up. But unloading of dollars into the financial system will only come into effect by dictating the exchange rate of the peso against the greenback.

Comparatively, the dollar;s value has become weaker against the Canadian dollar and the euro. In fact, a Canadian dollar now is worth about 44 pesos in the local exchange market. While that of the euro is more than 60 pesos. However, some economists are optimistic that the peso will start shedding off its value comes early next year when the holidays are over.