Deploy remittances for development -- ADB’s Nakao

Posted on March 19, 2015

REMITTANCES of migrant workers should be channeled to public investment that would spur additional jobs and ultimately allow them to find employment back home, speakers at an Asian Development Forum said.

Asian Development Bank President (ADB) Takehiko Nakao said yesterday that remittances from migrant workers help reduce poverty levels of developing countries and result in high spending on education and health among households.

These, however, come with a price as migrant workers experience long working hours, harsh environments, harassment and other working conditions.

“Many migrant workers are not properly covered by insurance or other protections in case of illness or accidents,” Mr. Nakao said in his remarks.

Thus, Mr. Nakao said remittances should be channeled to funds that would contribute to economic development and allow the migrant worker to find job opportunities back home.

“Remittances represent hard-earned money by migrant workers,” Mr. Nakao said.

“It is therefore important to channel remittances to improve the social and economic status of migrant workers and their household as well as to contribute to the country’s development,” he added.

“If channeled through the financial system, remittances can be intermediated for public investments such as infrastructure, health and education,” Mr. Nakao said.

Ayala Corp. Chairman and Chief Executive Officer Jaime Augusto Zobel de Ayala said Overseas Filipino Worker (OFW) remittances have largely fueled the Philippine growth story in recent years.

Mr. Zobel said there remains a need to develop “financially inclusive” products that would cater to the needs of migrant workers.

“While many are benefiting from our country’s growth momentum, economic and social progress has yet to be shared by the vast majority,” Mr. Zobel said.

“While we’re seeing more inclusive innovation in these sectors, the banking industry, however, for all its importance as a catalyst for inclusion, has not made in my opinion a significant leap to add value to this largely unbanked sector,” he added.

OFW remittances in January grew at their slowest rate in six years, the Bangko Sentral ng Pilipinas said early this week.

Cash remittances Filipinos coursed through banks grew to $1.814 billion in January from $1.804 billion a year earlier. -- Mikhail Franz E. Flores