Dubai debt crisis fallout could cost RP $300M in remittances - TUCP

PRESS STATEMENT

Former Senator Ernesto F. Herrera, Secretary-General, TUCP

2/F Marbella II Bldg., 2071 Roxas Blvd., Malate, Manila Contact: Tita Misolas@ Tel. 338-5034

December 6, 2009

Dubai debt crisis fallout could cost RP $300M in remittances - TUCP

The Philippines could lose as much as $300-million worth of remittances from Filipino workers based in Dubai due to the debt woes of Dubai World, one of the flagship holding firms of the United Arab Emirates (UAE), the Trade Union Congress of the Philippines (TUCP) said Sunday.

"If the labor department’s projection is accurate -- that as many as 200,000 Filipino workers there might be adversely affected -- then we risk losing one-half of all remittances from Dubai on an annual basis," said TUCP secretary-general and former Senator Ernesto Herrera.

"All of Dubai’s state-owned companies, the biggest employers there, will surely be forced to restructure, mainly through job cuts," said Herrera, former chairman of the Senate committee on labor, employment and human resources development.

Herrera said Filipino workers in Dubai’s construction, real estate, financial services, retail, trade, and travel and tourism industries could be among those hardest hit by the job losses.

The (Philippine) government should prepare to find alternative employment here or abroad for the workers that would be forced to leave Dubai, apart from extending them emergency financial assistance, Herrera said.

After Saudi Arabia, Herrera said the UAE is the second biggest source of remittances from Filipino workers in the Middle East.

He said annual remittances from the UAE are estimated at $632 million, accounting for almost 25 percent of all remittances from Filipino workers in the Middle East.

Citing Bangko Sentral ng Pilipinas statistics, Herrera said Filipino workers in the UAE sent home a total of $471.379 million in the nine months to September this year, down less than one-percent from the $474.249 million they remitted in the same period in 2008.

But this was before Dubai World rattled the global financial markets last week with news that it is seeking a six-month delay in repaying $60-billion worth of obligations, including $23 billion in debts.

Dubai World is an investment entity that oversees a portfolio of businesses and projects for the Dubai government across a wide range of industries and projects that promote Dubai as a hub for commerce and trading. It is the UAE's flag bearer in global investments and has a key role in the direction of Dubai's economy.

Dubai is one of the seven emirates that comprise the UAE. Dubai is also the UAE’s largest city, ahead of the capital Abu Dhabi.

In the nine months to September this year, remittances from Filipino workers in Saudi Arabia amounted to $1.106 billion; from Qatar, $132.263 million; from Bahrain, $124.969 million; from Kuwait, $78.062 million; from Israel, $25.988 million; from Oman, $24.948 million; from Lebanon, $8.499 million; and from Jordan, $5.156 million.

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