Make better use of OFW money

Cebu Daily News
Posted date: October 15, 2008

Wasn't it just a few weeks ago, just as the bad news from abroad came trickling in, that our officials were assuring us that we were relatively safe from the harsher impacts of the global economic meltdown?
A “bright spot” in our economy, we were told, were the overseas Filipino workers' (OFWs) remittances, which have been shoring up our reserves for well over a decade. But look what's happening now. With banks and other financial institutions toppling over like dominoes, swiping savings, retirement funds, investments and insurance plans along with them, the bad news has finally washed ashore.

OFWs, especially members of the upwardly mobile middle class in the United States, Canada, Australia and other such destinations, are feeling the squeeze. And when hard times hit, remittances - money sent home to family to build a house, send a youngster to school, or fund a business - are one of the first items to go.

Even more dire for Filipino workers in Hong Kong, Singapore, Malaysia, the Middle East and other places, where most of them work either in construction or services, including domestic work, employers are having to tighten their belts, searching for areas where they can cut back. Unfortunately, one of these areas is the salary paid to workers. Maids, especially, are vulnerable, since they are still viewed as “luxuries.”

Most studies have found that the earnings remitted back home by migrant workers have been used mainly for consumer spending, with the possible exception of education. Much of the blame has been laid at the door of the families at home, who end up “squandering” the wages of family members abroad on appliances and perks like cell phones. But a study by the Economist Intelligence Unit, sponsored by Western Union, also found that some of the blame falls on inefficient systems and indifferent government bodies.

“Some serious gaps remain in the understanding of how migrants can be encouraged to invest in their home communities and perhaps raise living standards, thereby reducing the outward flow of labor,” the authors said.

One can't help wondering what the situation would be today if governments, at both the national and local levels, had worked to better harness “remittance power” earlier in the game, long before the economic tsunami threatening this source of income had broken out.

But doing nothing seems to be an even worse alternative. Perhaps now, while the economic gloom and doom is but a distant shadow, we should begin steps toward making better use of this money. At the very least, we shouldn't let the wastage continue. The private finance sector, for one, could step in with packages to help returning overseas Filipino workers to maximize their savings and start businesses of their own, now that employment abroad looks ever more iffy. - Rina Jimenez-David, Inquirer