MANILA, Philippines—The government was urged to make the economy less dependent on foreign exchange remittances from overseas Filipino workers to sustain decent growth.

The call was made by the Congressional Planning and Budget Office (CPBO), the economic research office of the House of Representatives, in view of the strengthening of the peso.

In its study entitled “Weighing the Impact of the Peso Appreciation,” the CPBO noted that billions of pesos worth of remittances were lost due to the rise of the peso from January to December 2007 alone.

Remittances sent by OFWs to their families helped spur consumer spending and economic growth.

Citing figures as of 2006, the study said the 8.23 million OFWs were estimated to be supporting 40 million Filipinos, almost half of the country’s population.

The beneficiaries were estimated to have received about P8.6 billion less in remittances in December from what they got in January last year because of the appreciation of the peso over the 12-month period from 48.9 to $1 to only 41.7.

CPBO said OFW income would continue to shrink in peso terms, as the local currency was expected to reach as high as 39 to a dollar this year.

Given this projection, the economy should have more diversified sources of growth, it said.

“While OFWs have significant contributions to the economy, the government should not become overdependent on their remittances to boost growth,” CPBO said.

Although economic managers take pride in the Philippines’ accelerating economic growth, the fact that the number of OFWs continue to increase was proof that many Filipinos do not earn enough in their own country, the CPBO said.

It added that the government should set a long-term goal of improving the economy in such a way that employment would be sufficient for its citizens.

The think tank said that remittances from OFWs had been significant contributors to the economy, accounting for about 8.4 percent of the gross national product. Consumption, which is boosted by remittances, accounts for three-fourths of the GDP.

In the meantime, CPBO also urged the government and the private sector to take advantage of the rising peso. It said that while the peso had adverse effects on income of OFWs and exporters, there were ways to benefit from it.

The government is urged to prepay more dollar-denominated debts, whose peso amount shrinks with the rising value of the local currency.

Private companies, especially those using imported equipment, should pursue their plans to purchase such goods when the peso is strong to save on cost.