DUBAI - Filipino expatriates are planning to withhold money transfers to the Philippines from today until Monday (November 5) in a bid to push up the value of the US dollar by creating a temporary shortage of the greenback.
The campaign, which started in Saudi Arabia and Abu Dhabi, has snowballed throughout the Middle East and is said to have received a "positive response" in areas with a high concentration of Filipino workers such as the US, Canada, Italy, Japan, Hong Kong, and Taiwan, said Dick Orense, a Filipino community leader in Abu Dhabi.
"We don’t intend to sabotage the economy. We just want our voices to be heard," said Orense.
The idea to temporarily stop transfers as a means to raise the value of the greenback was bolstered by a paper written by an economist and published online early last month.
Cielito Habito, a former Philippine economic minister, said the country’s coffers were awash with dollars due to increased inflows of remittances from overseas Filipinos.
As of July, $8.1 billion (Dh29.7 billion) in remittances had already come in this year, a jump of 16 per cent from last year, he said.
Proponents of the boycott believe it would bring the dollar to the 50 peso (Dh4.2) level.
Bernie Cinco, a Filipino community leader in Abu Dhabi who works in Sharjah, suggested that remittances to the Philippines be sent through “unofficial channels”.
“This has a domino effect. The supposedly strong Philippine economy will surely be zapped once the dollar supply of banks gets depleted. Sending money through unofficial channels like door-to-door cargo forwarders would directly benefit our families and will not be subjected to bank charges,” he said.
Filipino expatriates had called for a special rate for overseas remittances as a stop-gap measure to the currency crisis.
Bankers, however, disagree. "A subsidy would bring us back to the subsidy era, which only created market and price distortions," said Amroussi Rasul, Vice-President and Middle East representative of Philippine National Bank.
On the other hand, overseas Filipinos couldn’t be blamed for taking drastic measures, he said.
“It’s a tight situation for those earning in dollars. The appreciation of the peso amounts to a virtual pay cut. They get much less at home for the same money they earn abroad,” Rasul told XPRESS.
An official of a leading money exchange company in the UAE debunked claims that the banking system will be put in disarray should remittances be sent through unofficial channels.
“Even if they remit money through door-to-door cargo firms instead of through money transfer agents, it’s the same story. Cargo companies also engage our services to send money in bulk,” said Carlos Serrano of Al Rostamani Exchange.
Ben Dumlao, a UAE-based Filipino expat, says the remittance boycott campaign is not a good idea.
“The depreciation of the US dollar has a domino effect worldwide. The purchasing power of the UAE dirham has gone down too. Prices of commodities and flat rentals are squeezing the budget of all expats in the UAE. We could not help but excruciatingly accept these facts,” he said.
Rasul meanwhile, said that whether this week’s planned money transfer stoppage would succeed or not, the Philippine government should attend to the problems besetting Filipinos overseas.
“We can’t belittle steps like this,” he said.
FORECAST:
Former Philippine economics minister Cielito has forecast a gloomy currency outlook as he sees the Philippine peso to strengthen to 40 pesos (Dh3.3) against the US dollar by yearend.
The peso-dollar rate is so far hovering at 43 pesos (Dh3.6).
The Philippine central bank has started buying the dollar in the currency market as the peso steadied near 43.98 per dollar and hit a seven-year high in Tuesday’s (Oct. 30) trading. Remittance inflows in 2006.
1. India - $24.5 billion2. Mexico - $24.2 billion3. China - $21 billion4. Philippines - $13.7 billion5. Russia - $13.7 billion.
(Source: UN Fund for Agricultural Development and Inter-American Development Bank) (Ares P. Gutierrez)
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