Cash remittances from OFWs up 3.7% in April RCEP utilization crucial to hit $241-B 2028 exports target

The Department of Trade and Industry (DTI) has highlighted the crucial role of the Regional Comprehensive Economic Partnership (RCEP) in hitting the export targets of the Marcos administration.

On Thursday, the Export Development Council (EDC) launched the Philippine Export Development Plan (PEDP) 2023-2028, which aims to nearly double the country’s export revenues over the next five years.

“RCEP utilization is an essential component in the successful implementation of the PEDP,” DTI Secretary Alfredo Pascual said.

Under the PEDP, the government targets an export revenue of USD126.8 billion by the end of 2023; USD143.4 billion in 2024; USD163.6 billion in 2025; USD186.7 billion in 2026; USD212.1 billion in 2027; and USD240.5 billion in 2028 or an average annual growth of 11 percent for the Philippine exports of goods and services.

According to the blueprint, exports of electronics and electrical goods will lead the export revenues, sharing 44 percent of the country’s total outbound trade.

Cash inflows from overseas Filipino workers (OFWs) rose by 3.7 percent year-on-year to USD2.48 billion last April, the Bangko Sentral ng Pilipinas (BSP) reported on Thursday.

Annual export targets for the semiconductor and electronic goods are at USD53.7 billion in 2023, USD61.1 billion in 2024, USD70 billion in 2025, USD80.3 billion in 2026, USD92.4 billion in 2027, and USD106.4 billion in 2028.

Following the electronics sector is the information technology and business process management (ITBPM) services, with revenue targets of USD36.1 billion in 2023, USD40.3 billion in 2024, USD45 billion in 2025, USD50.3 billion in 2026, USD56.4 billion in 2027, and USD63.2 billion in 2028.

Aside from electronics and ITBPM, among the major exports of the country listed in the PEDP include agriculture and agri-based exports; transport export products; home furnishings; wearable, fashion accessories and travel goods; minerals, and chemicals.

All these exports account for 88.5 percent of the country’s total export revenues.

The central bank attributed the rise in cash remittances, coursed through banks, to strong growth of remittances both from land-based and sea-based workers.

Data released by the BSP showed that cash inflows from land-based workers rose by 4 percent year-on-year to USD1.94 billion, while those from sea-based workers rose by 2.7 percent to USD55 million.

In the first four months this year, cash remittances reached USD10.49 billion, 3.2 percent higher compared to the USD10.17 billion same period last year.

Bulk of these inflows came from the United States, Singapore, and Saudi Arabia.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said cash remittances last April is lower than the nearly USD2.4 billion in the same period last year. He attributed the lower inflows partly to the risk of recession in the US and its impact on global growth and employment opportunities.

“The continued slowdown in OFW remittances data may also have to do with the still relatively higher prices/inflation/cost of living in major host countries for OFWs that fundamentally reduced the remittances sent back to the Philippines,” he added.

Ricafort said weakening of the Philippine peso against the US dollar likely contributed to the decline FCASH, P8