The dollar’s dropping value is becoming an economic drag on countries such as the Philippines that depend heavily on foreign
workers, the Wall Street Journal
reports. People who live on cash sent home by family members employed abroad report a sharp drop in income when pay in U.S. dollars is converted to the local currency.
“I used to get 43,000 pesos every two months, but now that’s down to 33,000,” says Philippines resident Lorena Baquillos, the wife of a Filipino merchant seaman who is paid in greenbacks.
More than 10 percent of economic output in the Philippines comes from remittances from overseas workers, one of the highest such proportions in the world. Many Filipinos take jobs in the United States as well as European, Asian and Middle Eastern countries whose currencies are closely tied to the dollar and, like the dollar, are still recovering from the 2008 global financial shock.
But Filipinos might start to think twice about leaving home for work.
“We are seeing a fundamental shift in the global economy,” said Philippines Finance Minister Cesar Purisima. “We have to be honest about the consequences of that and educate people about what’s going on.”
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