Philippine remittances post 2.9% growth in May 2025

Remittances from overseas Filipino workers (OFWs) rose 2.9% year-on-year in May 2025, but the monthly tally was the lowest in 12 months, data from the Bangko Sentral ng Pilipinas (BSP) showed.

Cash remittances sent through banks increased to $2.658 billion in May from $2.583 billion in the same month a year ago, the central bank said on Tuesday. This marked the slowest monthly remittance level in a year, or since May 2024.

May's growth rate also slowed from the 4% pace recorded in April, when cash remittances reached $2.664 billion.

Remittances from land-based workers increased by 2.8% to $2.12 billion in May from $2.06 billion a year prior, while sea-based migrant workers' remittances jumped 3.1% to $536 million.

"The increase in cash remittances drove an increase in personal remittances as well," the BSP stated.

Personal remittances, which include in-kind inflows, rose 3% to $2.97 billion in May from $2.88 billion the previous year.

Broken down, remittances from workers with contracts of a year or more increased by 2.8% to $2.29 billion, while those with contracts of less than a year jumped 3.4% to $590 million.

For the first five months of the year, cash remittances grew 3% to $13.77 billion from $13.37 billion in the comparable period last year.
During the January-May period, remittances from land-based workers climbed 3.3% to $10.94 billion, while sea-based workers' remittances edged 2% higher to $2.82 billion.

The United States remained the top source of remittances in the five-month period, accounting for 40.2% of the total. It was followed by Singapore (7.4%), Saudi Arabia (6.4%), Japan (5%), the United Kingdom (4.6%), the United Arab Emirates (4.2%), Canada (3.3%), Qatar (2.9%), South Korea (2.8%), and Taiwan (2.7%).

Personal remittances for the first five months increased 3% to $15.34 billion from $14.89 billion a year prior.

Economists are pointing to global economic uncertainties, particularly those stemming from U.S. tariff policies, as a potential factor in the slowdown.

"The slower global economy amid Trump's tariffs could have slowed down OFW remittances volume recently," said Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp.

Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co., echoed concerns about increased uncertainty due to tariffs. "The tariff move adds to geopolitical and trade uncertainty, which may deter foreign direct investment (FDI)," he said.

U.S. President Donald J. Trump first announced an initial round of tariffs in April and later this month sent out notices with updated rates.

"The imposition of a 20% tariff on all Philippine exports to the US starting Aug. 1, 2025 by President Trump is expected to have significant and multifaceted effects on the Philippine economy," Ravelas added. The Philippines was hit with a 20% reciprocal tariff, higher than the 17% announced in April.

"For the coming months, protectionist policies by Mr. Trump, particularly stricter immigration rules could weigh on some OFW remittances, especially from the US," Ricafort warned. Trump has vowed mass deportations, citing high levels of illegal immigration under his predecessor, Reuters reported.

Trump's recently passed "One Big Beautiful Bill" also imposes a 1% excise tax on remittance transfers from the United States to other countries, effective after Dec. 31, 2025. This was lower than earlier proposals of a 3.5% levy and, initially aimed at non-U.S. citizens, now applies to any remittance sender.

"Trump’s threats of higher tariffs and other America-first policies could also slow down global trade, investments, employment including some OFW jobs, and overall world economic growth, thereby could also indirectly slow down the growth in OFW remittances," Ricafort added.

The central bank projects remittances to grow by 2.8% this year.