Cambodia and Philippines Head ASEAN in Remittance-to-GDP Ratios, Fueling Economic Resilience

The Philippines and Cambodia have become the leading ASEAN nations with the highest remittance-to-GDP ratios, latest reports indicate. These remittances are at the forefront in supporting their economies, especially in the post-pandemic economic recovery period. Here is the detailed summary:

 

Key Highlights

Philippines' Leading Position:

 

The Philippines' remittance-to-GDP ratio stood at 9.5%, the largest in the ASEAN region.

 

Remittances are still a source of livelihood for Filipino households, significantly contributing to household consumption and economic stability.

 

Cambodia's Strong Performance:

 

Cambodia's remittance-to-GDP ratio is at 4.4%, putting it in the top three ASEAN countries.

 

The remittance inflows for Cambodia hit $1.25 billion in 2022, an increase of 8% from last year.

 

Economic Impact:

 

Remittances have been a key in keeping livelihoods going and propelling domestic demand in both countries.

 

These inflows finance education, health, and investment in small business, promoting sustained economic growth.

 

Drivers:

 

High volumes of workers from Cambodia and the Philippines overseas are a principal driver of such strong remittance flows.

 

Overseas employment for Cambodians is highest in Thailand, South Korea, and Malaysia, while Filipinos work worldwide with a high representation in the Middle East and North America.

 

Prospects:

 

Both nations are set to have robust remittance inflows, fueled by secure jobs overseas and enhanced money transfer financial services.

 

Policymakers are keen on using the inflows for sustainable development as well as economic diversification.

 

This development highlights the importance of remittances in ASEAN economies, especially in Cambodia and the Philippines, amid the challenges in the world economy.

 

Sources: Cambodia Investment Review, ADB Institute Report