Cabinet okays creation of bank for OFWs

President Gloria Macapagal Arroyo disclosed yesterday that the Cabinet has approved the conversion of the Philippine Postal Bank into the Overseas Filipino Workers Bank to give OFWs an alternative channel for remitting their dollar earnings to their families back  home at lower services fees.

As approved during the Cabinet meeting Tuesday upon recommendation of Labor Secretary Patricia Sto. Tomas, the Overseas Workers Welfare Administration (OWWA) will infuse a P1 billion equity into the Postal Bank, which is now owned by the Philippine Postal Corp.

"The infusion of fresh capital will enable the bank to modernize its facilities to enable it to receive remittances of earnings of overseas workers," the President told a roundtable discussion telecast over NBN-4.

Mrs. Arroyo boasted that the OWWA has chalked up an P8 billion surplus last year compared to a net loss before she came into power.

OWWA Administrator Marianito Roque said that at present, commercial banks charge from $5 to $20 per dollar remittance of OFWs. He said the

OFWs would naturally prefer to remit their money through banks that charge less service fees.

"That is the newest kind of service that we are trying to extend to our overseas workers, our modern-day heroes­the machinery of the Postal Bank which we want to transform into an OFW Bank," the President said.

The President noted that OFWs from all over the world remitted a total of $11 billion to the Philippines last year the biggest amount  of remittance so far by those workers group.

She said the increased remittances from OFWs and inflow of foreign investments were the biggest factors for the strengthening of the peso and the hike in the international dollar reserves to $20 billion as of the end of 2005.

"We need to boost our dollar reserves to maintain the stability of the peso. We should have at least $15 billion to $16 billion reserves. But our reserves have exceeded $2 billion," the President said.

Mrs. Arroyo said that the Philippine Overseas Employment Agency and OWWA have taken steps to improve the services to OFWs before they

Leave the country and upon their return.

She said OFWs can now borrow up to P40,000 from the OWWA fund to finance their overseas placement. She said the OWWA also extends assistance to OFWs' who are victims of abusive recruiters and employers, who have contracted ailments and who have been jailed for criminal offenses.

Last year alone, more than 50,000 OFWs who were maltreated by their employers were assisted by the government. This included 97 workers who were jailed in Saudi Arabia.

The President said the government is also helping the OFWs in investing their money in various kinds of enterprises.

She said the entry of the proposed OFWs' bank into the remittance business will also boost the government's campaign to encourage workers to save their income.

Meanwhile, the President said she has authorized the allocation of P500 million for government scholarships to high school graduates  who will take up vocational courses to fill the demand of the industries for workers who are well-trained for technical jobs. The President said the fund will be channeled to state colleges and universities.

Other guests in the roundtable discussion were POEA Deputy Administrator Ramon Tionloc, Philippine Postal Bank president Rolando Macasaet, Industrial Management and Personnel Services president Angelito Hernandez and OFW Rodolfo Estrada, business manager of the Disney Magical Cruise of Florida.

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