Press Release

OFWs as foreign investors
Conference takes a new look at economic power of OFWs

By Jeremaiah M. Opiniano
OFW Journalism Consortium

DAVAO CITY-A recent conference on the economic potentials of the remittances of overseas Filipino workers held in Davao City generated much excitement among participants as it examined the role of OFW investments in turning the country's economy around.

Over the past three years, overseas Filipino workers have saved the Philippine economy with over six billion dollars in annual remittances. Studies show that many Filipino migrants use their remittances to support their families' basic economic needs such as home building, children's education and the purchase of appliances.

However, there are those who chose to flaunt their wealth in expensive non-productive pursuits such as the purchase or building of unusually large houses, holding frequent parties and mounting extravagant weddings.

Imagine what migrants' repatriated earnings could do to help the country overcome poverty if OFWs were given proper guidance on how to use their remittances constructively and productively?

The government, said rural banker Andres Panganiban, keynote speaker at the International Conference on Identifying Economic Linkages Between Overseas Filipinos and the Rural Communities in the Philippines, held April 10 to 12 in Davao City, has missed out on developing Filipino migrants as "foreign investors" who bring in foreign investments.

The conference was organized by the Geneva-based Economic Resource Center for Overseas Filipinos (ERCOF) and the Davao-based Mindanao Land Foundation (MLF), with support from the Philippine-based Federation of Peoples' Sustainable Development Cooperatives (FPSDC) and Foundation for a Sustainable Society, Inc. (FSSI), and donor agencies Cord-Aid and Oxfam-Netherlands.

OFW investments for development of local economies
OFW remittances, Panganiban said, "are hard foreign currencies coming to the country. As such, these remittances must be directed to the development of local economies."

In his speech entitled "Overseas Filipino Investments for the Development of Local Economies", Panganiban said, "The productive use of remittances during and after migration is a strategic issue for the (overseas Filipino workers) and their families, for support organizations, and the governments of both labor sending and receiving countries. The challenge now is how to direct the utilization of remittances towards productive use."

Panganiban urged a cultural shift in OFWs' use of remittances - "from traditional bags" such as economic needs and superfluous expenses "to non-traditional opportunities."

Panganiban, who is president of the New Rural Bank of San Leonardo, Nueva Ecija, was among the first to organize Filipino migrants in Hong Kong in the 1980s as executive director of the Asia-Pacific Mission for Migrant Filipinos (APMMF).

In Davao, he shared with an international audience of 150 delegates, his ideas on how Filipino migrants could use their remittances productively.

The conference presented the best practices of individual OFWs, and government and civil society groups here and abroad on the utilization of OFW remittances.

Creative use of IT
Antonina Dinsol, an information technology expert based in Japan, uses the Internet to ask Filipinos in Japan to donate to poor communities and development projects in the Philippines through the "Tulong Pinoy (Help Filipino) Movement."

Using Internet search engines to find kind-hearted Filipino migrant donors, Dinsol's movement has called migrants to donate not just money, but clothes, toys, books, computers, appliances, and even used items to rural tribes and urban poor children in Malabog, Davao City; Botolan, Zambales; Capalan City, Oriental Mindoro; Agoo, La Union; and Payatas, Quezon City.

Donors come from the United States, Saudi Arabia and Australia, according to Tulong Pinoy's newsletter.

A similar approach is the LinKaPil (Lingkod sa Kapwa Pilipino - Help for a Fellow Filipino) program of the Commission on Filipinos Overseas (CFO) under the Department of Foreign Affairs. From 1990 to 2001, CFO raised over one billion dollars in cash, in addition to donations in kind and expertise.

Donations coursed through LinKaPil, said CFO director Corazon Rodolfo, go to projects in CFO's priority areas: livelihood, education, health, and infrastructure. This does not include visits of Filipino expatriates to the home country to give training on primary health care or enterprise development.

Book donations also flood the CFO office in Manila, Rodolfo added.

Other approaches
There were other approaches featured in the conference such as cooperative building, micro-enterprise development, and banking. Dennis Yaun, a Filipino based in Luxembourg, said that when he was in Belgium, his group-Samahan--set up a cooperative that now has a rolling capital of US$18,000.

Repayment rate is at 105 percent because of advance payments of dues, Yaun said adding, "All of (Samahan's) 17 members are happy with the facility, especially when we receive our dividends."

The New Rural Bank of San Leonardo in Nueva Ecija, ERCOF, and the migrant NGO Kanlungan Center Foundation in Manila will also jumpstart reintegration with their Center for Rural Training on Entrepreneurship (Certain) program.

Certain will introduce various income generating projects to enterprising OFWs' beneficiaries; research, document and replicate successful micro-enterprises; and link enterprising beneficiaries and return migrants to formal financial institutions.

Kanlungan, run by Miriam College professor of social work Mary Lou Alcid, does crisis intervention for aggrieved OFWs, especially women. Kanlungan has formed a group of returning migrants in La Union, the Bannuar Ti La Union, which helps members' with their economic needs.

Dr. Mario Lamberte, president of the Philippine Institute for Development Studies (PIDS), said that OFWs will be better off investing their surplus funds in financial instruments such as deposits, bonds and equities.

OFW rural bank
Lamberte proposed setting up an OFW Bank which, he said, is not a bank only for OFWs, but a regular bank that provides financial services to both OFWs and non-OFWs.

He said that if 130 OFWs pool their savings of P 50,000 each, they would be eligible to set up an OFW rural bank.

"Owning (an OFW) rural bank promotes their financial interests further and, at the same time, serves the communities in which they live," Lamberte said. And this could even have a positive effect on the commercial banking sector and the Philippine financial system if experts would only look at the economic potentials of OFWs.

"I could only hope that the Central Bank will take a look at the potentials of these OFWs," said Jesuit priest and financial expert Emeterio Barcelon, former president of the Ateneo de Davao University.

The potential of OFW remittances made Emma Lim-Sandrino of the Federation of Peoples' Sustainable Development Cooperatives (FPSDC) in Quezon City design a social investment program (SIP) for OFWs.

This SIP, Lim-Sandrino said, will be tapped as capital that will be used to extend loans to small- and medium-scale enterprises in the countryside.

Lim-Sandrino even proposed models of how individuals, the rural communities of origin, and some intermediaries here and abroad can play roles in this social investment program. With the individual migrants abroad as source and the rural communities as recipients, the intermediary institutions will help direct the remittances to productive investments here at home.

Possibilities for returning migrants
This will lead to many possibilities for returning migrants, such as contract manning services or ship repair services for former merchant seafarers, care centers for children and the elderly for domestic workers, or a cooperative hospital as an option for returning Filipino health professionals, Lim-Sandriano said.

Many participants, migrant advocates and those working in sectors such as health care, education and the urban poor, showed much interest in the presentation of best practices. A representative of a rural NGO engaged in agrarian reform advocacy, said he is exploring the possibility seeking OFW support for his NGO's development projects.

But while the identified best practices are economic in nature, delegates and resource persons said that the social aspect of the crusade for viable OFW investments should not be overlooked.

Lamberte said organizing the OFWs is important in forming OFW rural banks since "the benefits and costs of doing it must be clear to them before [they make] any decision."

A two-country approach is also necessary. Samahan's Dennis Yaun said, "It is an undeniable fact that migrant workers are grounded in two different countries. Being in this kind of situation brings advantages to both countries - which is the potential of migrants for development." -- OFW Journalism Consortium

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Press release contributed by:

OFW Journalism Consortium
Contact address: INSTITUTE ON CHURCH AND SOCIAL ISSUES
2/F ISO Building, Social Development Complex, Ateneo de Manila University,
Loyola Heights, Quezon City, Philippines
63-02-4265953, 4266070 (fax), jopiniano@lycos.com, OFJournConsortium@yahoogroups.com