Two to three million more Filipinos would have fallen below the poverty line if not for remittances received from Overseas Filipino Workers (OFWs.) That's according to Ernesto Pernia, a former chief economist at the Asian Development Bank (ADB). Pernia said remittances were able to reduce the country’s poverty incidence by 3 to 4 percentage points, which translates to around 2 million to 3 million Filipinos according to an article from the May 4, 2011 online edition of ABS CBN news.com. (photo from Flickr)
The ABS CBN report states that the reduction in the number of poor Filipinos would have been higher according to Pernia if not for the “inequality” effect that was observed among households receiving remittances. Usually, he said, richer households get the bulk of overseas remittances every year.
“Most OFWs originate in the Philippines’ more developed regions [and] smaller shares [come] from poorer regions. Likewise, the bulk of remittances go to the richer regions [and] smaller shares [go] to the less-developed regions. Hence, richer regions develop faster than poorer ones, worsening regional imbalance or inequality,” Pernia explained.
Based on Pernia’s findings, as much as 50 percent of international remittances are sent to the three richest regions in the country. The National Capital Region (NCR) which consists of the Metro Manila area, the country’s richest region, accounts for 18 percent to 27 percent of total remittances from 1995 to 2004.
The second region, Southern Tagalog, consists of the provinces of Aurora, Bantagas, Cavite, Laguna, Marinduque, Oriental Mindoro, Occidental Mindoro, Quezon, Rizal, Romblon, and Palawan which accounts for 18 percent to 22 percent.
The third region indicated by Pernia is Central Luzon, located north of Manila, and includes the cities of Balanga, Malolos, Meycauayan, San Jose del Monte, Cabanatuan, Gapan, Munoz, Palayan, San Jose in Nueva Ecija, Angeles, San Fernando, Tarlac, and Olongapo and accounts for 12 percent to 15 percent of total remittances between 1995 and 2004.
If not for the sacrifices made by these Overseas Filipino Workers and the remittances they send back home, millions of Filipinos would be suffering under even harsher conditions that already exist in the Philippines. Though OFWs are often underpaid and work in extremely difficult conditions separated by their families for years at a time, they are the backbone of the economy of the Philippines. Again, it would a far better situation for them and their loved ones if the Philippines government would provide jobs for them in the Philippines. But until that day happens, if it ever does, those remittances continue to feed and clothe millions of Filipinos.