Filipinos in Italy invest in ‘paluwagan’

Veronica Uy
INQUIRER.net
Posted date: May 22, 2009

MANILA, Philippines—Even as they are miles away from home, Filipinos in Italy still retain many traditions, including financial traditions. An ongoing research by the International Organization for Migration shows that some of them invest in the so-called “paluwagan.”
According to the preliminary findings of the IOM research on remittance flows between Italy and the Philippines, some 26 percent of the interviewees said they had invested money in rotating and savings associations locally known as paluwagans, and 38 percent more had invested in cooperatives and in rural banks.

The research also shows that 72 percent of Filipinos in Italy send money home on a monthly basis, with 63 percent saying they remit on average 350 euros a month.

Forty percent of the respondents said they had been sending money home for more than 10 years, with women on average remitting more money than men.

When asked about their plans, 55 percent of respondents said they wanted to bring their families to Italy, although an overwhelming majority (91 percent) said they planned to retire in the Philippines.

In 2008, the 8.73 million Filipinos overseas remitted $16.4 billion, which represents 9.7 percent of the country’s gross domestic product.

However, the global financial crisis has led to a reduction in the number of Filipinos deployed abroad and to a slower growth rate of remittance inflow, with a two percent recorded growth in February 2009 compared to 13 percent annual growth recorded in 2008.

The IOM was recently in Rome to meet with Philippine and Italian government officials, non-government organizations, international agencies, and the private sector, and discuss ways to enhance the development potential of remittances.

The initial results of the study were released in the meeting which aimed to identify best practices that would encourage the investment of remittances in activities that would stimulate growth and employment in the Philippines.

The meeting is partly funded by the European Community to improve the knowledge of remittance corridors, enhance the development potential of remittances through inter-regional dialogue through the setting up of pilot projects in southeast Asia and Europe.

According to Philippine records, as of December 2007, there are 120,192 Filipinos in Italy, with 24,598 permanent, 82,594 temporary, and 13,000 irregular residents.