PCGNY.net | Consulate General of the Philippines in New York

INCREASING REMITTANCES AND INVESTMENTS FROM THE FILIPINO-AMERICAN COMMUNITY

Objectives
The overarching objective is to tap the overseas Filipino community to assist in alleviating the effects of the impending fiscal crisis through the increased inflow of funds.

The campaign will set the following targets:

Enjoin the Fil-Am community to remit an additional 20 percent of current remittance levels.
Invite the Fil-Ams to invest at least $2,000 in blue-chip Philippine stocks or government securities.

Remittances
Based on a 2003 study by the Asian Development Bank, the estimated total dollar remittances of overseas resident Filipinos is in the range of $14 billion. These remittances are sent through the banking system (formal channels) and alternative remittance systems.

Of the total dollar remittances worldwide, it is estimated that one-third, or the range of $4.7 billion, are from the United States. An increase of 20% will mean an additional $940 million, or 52.64 billion pesos flowing into the domestic economy.

According to the same study, remittances held as deposit money in the banking system and its microfinance extensions has an estimated multiplier effect of between 2 to 3.

Assuming a modest 2.5 multiplier effect for the incremental funds, the 20% increase in remittances will translate to an estimated P132 billion.

Investments
The most practicable and direct way to buy foreign securities in the U.S. is through American Depositary Receipts (ADRs). However, only a few Philippine companies have ADRs listed in the New York Stock Exchange. Hence, the proposed investments can simply be made through family and/or friends in the Philippines.

If an estimated 200,000 Filipino-Americans invest at least $2,000 each, it could be presumed that $400 million will flow into the Philippine securities market, or 22.4 billion pesos.

If the same multiplier effect of 2.5 is used, the projected investments will translate to an estimated P56 billion pesos.

Cumulative Target for Remittances and Investments

Cumulative target for new inflows: 75 billion pesos.
Cumulative target with multiplier effect: 188 billion pesos

Additional Information
The Philippine Stock Exchange - http://www.pse.org.ph

Investing Procedures - http://www.philippineembassy-usa.org/investing_procedures.htm

Trading Participants
AB Capital Securities, INC - http://www.abcapitalonline.com
BPI Securities Corporation - http://www.bpitrade.com
Diversified Securities, INC - http://www.dfnn.com
F. Yap Securities, INC - http://www.2tradeasia.com
PNB Securities, INC - http://www.psedirect.net/pnb
RCBC Securities, INC - http://www.rcbcsec.com