A Remittance Dependent Pinoy Economy

[ghosthunter]

Nothing much different from our local politicans who switch political parties whenever it suits them (or rather: when-the-price-is-right).

[jpdm]

dude, i'm talking about your stand

your stand shifts depending on the articles you read and post

like the losing power of the peso thread

at the beginning of the thread, you call for the govt (and BSP) to defend the peso

No, I did not.

then later in the thread, you posted an article where a local economist says a weak peso is good for the Phils. (P55 to $1 yata yun) then suddenly you are FOR a weak peso

Its not sudden.

jpdm, my point is, you do not have a solid stand

your stand shifts when you read something new

i have a stand.

Like in this thread...

against ka sa dependence of the philippines on labor export

but now, you are happy remittances are at record levels

Im against the dependence of the country on labor export. That's why we need to strengthen our domestic economy.

Reports said about record remittances in 2008, should I be sad about it?
Nandyan na yan. At least more dollars to replaced lost earnings from exports.

Siguro, I will not be happy if the article will say more OFWs will be sent abroad in order to bring more NFIAs to the country this year and beyond.

[jpdm]

sorry double post

[jpdm]

opps, sorry again.double post

[uls]

this is from the Losing Power of the Pinoy Peso thread:

from page 2 --

jpdm:

Well, what are the concrete steps the government is doing to stop the peso's steep fall?

jpdm:

Do you think the government has No BIG AND CRUCIAL ROLE to stop the rapid depreciation of the peso?

from page 3

jpdm:

Do you really think our government will just allow the market forces determine the value of the peso, and let it go into a free fall?

Do think then that this is the most pragmatic way to do it?

jpdm:

Well, BSP is continuously supporting the peso to prevent it to slide further...

jpdm:

Another 'extraordinary move of BSP to protect to peso....

then on page 6:

jpdm

The government should stop intervening in the Philippine Dealing System and let the peso seek its own value...

that was your comment to an article you posted:

Manila Times
December 5, 2008


Forex Rate at 55 pesos per Dollar Sought
By Ben Arnord O. De Vera


The peso should be allowed to depreciate to about P55 to the dollar to boost local consumer spending and to improve the country’s export competitiveness, an economist said at an exporters’ forum on Thursday.

[uls]

after reading Diokno's opinion, your standed shifted

Now an economics professor at the University of the Philippines in Quezon City, Diokno explained that the depreciation of the peso would encourage more overseas Filipino workers to send more money back home. With a bigger value for their money here, he said, recipients of the remittances would get to spend more. The Philippine economy is still mainly driven by consumption, Diokno added.


“Then, when the local business sector sees that consumers are willing to spend, they would be more confident to invest in and drive our economy,” he told reporters at the sidelines of the forum.


Diokno said that the Bangko Sentral ng Pilipinas should refrain from defending the peso from further depreciation. “We should never allow the exchange rate to reach P40 to a dollar.”


He suggested that the central bank leave the foreign exchange on its own, or to fix the exchange rate at P55 per dollar. Diokno said that such rate can be maintained just momentarily until the global economy stabilizes.

[jpdm]

this is from the Losing Power of the Pinoy Peso thread:

that was your comment to an article you posted:

Based on my reactions, comments,questions (regarding the articles posted/replies of posters).. I never stated categorically that the BSP should intervene directly to defend the peso.

Its very clear.

[jpdm]

Philippine Star
Government urged to institute measures to lessen RP dependence on remittances
By Iris C. Gonzales
Updated February 23, 2009 12:00 AM

MANILA, Philippines - The government needs to put in place measures that would boost the local economy to lessen the country’s dependence on dollar remittances from overseas Filipino workers (OFWs).

Private think-tank IBON Foundation said the country’s dependence on exports, foreign capital and remittances make the Philippines very vulnerable to the current global financial turmoil.

“The onset of global financial and economic turmoil pushes the country into deeper crisis, especially since it is more dependent than it has ever been on exports, foreign capital (investments, debt and aid) and remittances. The country is going to be seriously affected particularly because the last decades of globalization policies have made the economy extremely vulnerable to external shocks and internally much weaker,” IBON said.

It said the situation that Filipino workers abroad are facing should be a wake-up call for government.


“While the administration has been criticized for its overdependence on remittances, it still places high hopes that the steady flow of OFW remittances will buffer the domestic economy. Such hopes may turn out misplaced as remittances and incomes of OFW households are at risk,” IBON said.


As of Jan. 31, this year, the Philippine Overseas Employment Administration (POEA) has reported that there have been 5,221 displaced OFWs in 15 countries who have returned home since the global economic downturn worsened in September 2008. The agency also listed more than 270 retrenched OFWs in five countries who are awaiting deployment because of establishment closures in their host countries.


IBON said there are also other less obvious risks for migrants. Prospects in seemingly less affected countries will also be poor in projects that involve US, Japanese and European investors — who are all grappling with domestic recessions and difficult financing conditions — or are aimed at US, Japanese and European consumers.


“The situation is a wake-up call for government which has mythologized overseas remittances as some kind of magic bullet for development,” IBON said.


Remittance sources are concentrated in just a few countries which are all facing varying degrees of economic difficulty, the think-tank said.


In 2008, the top 10 countries accounting for 88 percent of total remittances are the United States, Saudi Arabia, United Kingdom (UK), Italy, Canada, United Arab Emirates (UAE), Japan, Singapore, Hong Kong and Germany. 

Agree here.