Jinggoy lauds DBP's hedging facility for OFW remittances; calls on other banks to offer similar services

Senate President Pro Tempore Jinggoy Ejercito Estrada today lauded the Development Bank of the Philippines (DBP) headed by its chairperson, former Labor Secretary Patricia Sto. Tomas, for offering a "special hedging facility" to cushion the impact of the appreciation of the peso against the US dollar, as he called on other banks to offer similar services to overseas Filipino workers.

Estrada, concurrent chair of the Committee on Labor, Employment and Human Resources Development and of the Joint Congressional Oversight Committee on Labor and Employment, has consistently called on the government to undertake measures to mitigate the effects of the exchange rate.

"One of my committees' efforts is aimed at helping OFWs cushion the fall of the US dollar in its peso equivalent, and its adverse effects on the millions of Filipino families depending on our OFWs' remittances," Estrada said.

The government-owned DBP recently announced its opening of the special hedging facility this month.

Under the facility, OFWs will get the peso equivalent of their foreign currency earnings set at the signing of their contract, making the peso equivalent of their dollar earnings fixed for a certain period of time.

The US dollar remains to be the benchmark of OFW earnings.

Estrada and Sto. Tomas, during their earlier meeting, agreed to call on other banking institutions to establish a similar hedging facility.

"Our overseas Filipino workers - who contribute billions of dollars yearly into our economy - deserve all the help and support from our government," Estrada said, as he noted complaints by OFWs that from 56 in September 2005, the peso now averages at 42:$1, such that their usual $400 remittance which then amounted to more than 22,000 pesos now translates to only less than P17,000.

"Our government must come up with innovative measures like this hedging facility to serve as protection to remittances against adverse economic occurrences - as both an immediate response to their current problem, and, as an institutionalized strategic response to concerns like this. We should not just leave our 'modern-day heroes' at the mercy of market forces," Estrada added.