The Philippines is likely to be among the top recipients of remittances for this year, with inflows projected to hit $40 billion, according to the World Bank.

'The top five recipient countries for remittances in 2023 are expected to be India, with an estimated total of $125 billion, followed by Mexico ($67 billion), China ($50 billion), Philippines ($40 billion) and the Arab Republic of Egypt ($24 billion),' the World Bank said in its latest Migration and Development Brief.

It said the projected remittance inflows to the Philippines would grow at over five percent this year compared to the under four percent uptick in 2022.

Data from the central bank showed personal remittances from overseas Filipino workers hit a record high of $36.14 billion in 2022, 3.6 percent higher than the $34.88 billion in 2021.

'The sustained growth of remittance flows to the Philippines was an outcome of a well-diversified set of host destinations across the world,' the World Bank said.

It said there were strong inflows particularly from destinations including Hong Kong, South Korea, Singapore and the Middle East.

'The impact of the Filipino government's proactive stance in negotiating specific deals with foreign governments, such as Saudi Arabia to protect its workers also contributed to facilitating emigration to that country,' the World Bank said.

It said the sustained growth in remittance flows to the Philippines will support the increase in remittances to East Asia and the Pacific region.

The World Bank expects remittances to East Asia and the Pacific to rise by three percent to $133 billion this year.

Excluding China, it said remittances to the region are estimated to grow by seven percent to $83 billion this year.

For 2024, the World Bank said remittance flows to the Philippines are projected to grow by about five percent to reach $42 billion.

It said remittance growth next year would be supported 'largely by labor market conditions in high-income countries, such as the United States, as well as destinations in Europe, high-income East Asia, and the GCC (Gulf Cooperation Council).'

For East Asia and the Pacific, the World Bank expects remittances to pick up by 2.4 percent to reach $136 billion next year.

Excluding China, remittances to the region are expected to rise by five percent to over $87 billion in 2024.

'Inflation is projected to slide further, and the prevailing tight labor market conditions are likely to persist in most high-income host economies of East Asian migrants,' the World Bank said.

While there may be a slight increase in unemployment in the US in 2024, it said this is likely to be offset by even lower inflation, which should allow migrants to continue to send remittances to the region.

In terms of remittance cost, the World Bank said the fees for sending money to the Philippines were the lowest among the least expensive destinations in the region.

It said the average cost of sending $200 to East Asia in leading least cost corridors was generally under three percent in the second quarter of this year.

With remittances projected to continue to rise, the World Bank said countries may mobilize diaspora finances for development and to strengthen their debt position.

'Remittances are one of the few sources of private external finance that are expected to continue to grow in the coming decade. They must be leveraged for private capital mobilization to support development finance, especially via diaspora bonds,' Dilip Ratha, lead economist at the World Bank and lead author of the report said.

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