PNB eyes other overseas workers as OFW market in HK softens

Hong Kong – Remittances from overseas Filipino workers in the former Crown Colony are expected to drop in the coming years but the Philippine National Bank (PNB) said it was taking advantage of the growth in the remittance market in other Southeast Asian countries.

The Hong Kong Special Administrative Region has began in earnest to implement its program ultimately intended to discourage the importation of labor from outside China.

In the last few months, Hong Kong authorities have imposed a salary cap on foreign domestic help and recently, they have imposed a HK$400 monthly tax on employers who hire foreign domestic help.

The ultimate impact, according to PNB Remittance Center general manager Rolando Cruz, is the decline in the deployment of OFWs to Hong Kong, particularly domestic helpers.

From a peak of about 160,000, Cruz said the Filipino community in Hong Kong has shrunk to 129,000 caused by the combined effects of the SARS epidemic, the wage cap and the general slowdown in the Hong Kong economy.

"This has resulted in the decline of our remittance business," Cruz said. "But there are still opportunities to be made, in spite of that."

According to Cruz, other countries in Southeast Asia have been deploying more and more workers to Hong Kong. Indonesia, for instance, has increased its community from 330,00 to 78,000. "Indonesian workers are willing to accept lower pay and working with no holiday breaks," Cruz explained. "Naturally, they’re filling in the vacuum left by Filipino workers who are aware of their rights."

PNB has already tied up with Bank Mandiri, the biggest and most profitable bank in Indonesia. According to Cruz, Bank Mandiri is restricted from opening as many branches as it needs to serve Indonesian workers, so they have tied up with PNB.

"They will use our remittance centers to handle remittance to Indonesia and that‚s more business for us even if OFW remittances go down," he said.

PNB has already tied up with the 7-11 network in Hong Kong and OFW are already able to remit their money through one of the 480 convenience stores scattered around the territory.

Cruz said the PNB was also tying up with another convenience store chain, the Circle K, with about 150 outlets. "We have a headstart in this area and we are taking advantage of it," he said.

Ultimately, however, Cruz explained that the opportunities for Filipino workers would decline. He explained that the tax now being paid by Hong Kong employers were supposed to go into a fund that would finance the training of the domestic labor force.

"This tax is naturally going to be passed on to our OFWs so their salaries would shrink further below the HK$3,670 monthly salary cap," he said. "In effect, they’re also paying for their own extinction."

Immigration from the mainland is still heavily restricted but Cruz said that eventually, the government’s objective was for Hong Kong residents to source their labor requirement from there instead of importing from other countries.