Dollar inflows to the country will remain robust over the medium term, even if growth in remittances slows down, given the rosy outlook for tourism and business process outsourcing sectors.
This was according to the Bangko Sentral ng Pilipinas, which said that the country would continue to enjoy substantial foreign exchange inflows over the next few years because tourism receipts and foreign investments in the BPO sector were expected to post significant growth rates.
“We have seen two emerging sectors: BPO and tourism,” BSP Deputy Governor Diwa Guinigundo told the Inquirer. He was reacting to projections that growth in remittances might eventually plateau and drag down dollar inflows to the country.
Guinigundo said efforts to market the country’s tourist destinations should bring in more foreign exchange receipts.
On BPO, he cited the industry’s encouraging growth forecast for the medium term.
“BPOs will continue to see a 15-percent annual growth in the next few years. The base is about $10 billion, so one could just imagine how much this sector is going to grow in the future,” Guinigundo added.
He said growth in remittances might slow down and eventually plateau, but that would not happen within the next few years.
He said that while some labor markets offshore became saturated, others would open up and provide job opportunities for Filipino workers.
Remittances amounted to $20 billion last year, up by 7 percent from the level in the previous year. For this year, remittances are seen to grow by 5 percent to $21.1 billion.
According to the BSP, the Philippines will continue to see a sustained buildup of foreign exchange reserves in the years ahead as tourism receipts and BPO investments rise.