Higher wages in Emirates entice Filipino expats to invest

Reuters

• Around 560,000 Filipinos live in the UAE, the fifth-largest nationality
• Survey of 3,800 Filipino expats found that 80% plan to invest
• 35% of respondents earn under $1,362 a month

Four-fifths of Filipino expats in the UAE plan to make investments in the next 12 months as rising wages and a strong dollar give them greater purchasing power back home. 

The UAE’s official population statistics do not provide a breakdown by nationality, although by unofficial estimates there are around 560,000 Filipinos living in the UAE, making them the fifth-largest nationality in the country.

A survey of 3,800 Filipino expats found that 80 percent of respondents plan to invest some of their earnings over the next 12 months. 

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Among participants, 61 percent will invest in property, 58 percent in new startups and 32 percent in mutual funds, according to research by Dubai’s New Perspective Media Group. 

“A considerable number of Filipinos have tested the water of entrepreneurship by starting small,” said Vine Ang, New Perspective Media chief operating officer. 

“Some of them are keeping their job while managing their business and some of those who have managed to grow their business successfully have chosen to focus on their business full time.”

In terms of their current asset portfolio, 42 percent of respondents possess gold or diamonds, 34 percent own property, 18 percent hold mutual funds and 11 percent have their own business. 

The survey did not ask where respondents would invest in property, although it is more likely they were referring to buying real estate in the Philippines, rather than the UAE.

In terms of monthly salaries, 35 percent of respondents earn less than AED5,000 ($1,362), 40 percent receive AED5,001-10,000, 13 percent get AED10,001-20,000, 8 percent are paid AED 20,001-40,000, and 4 percent earn more than AED40,000. 

Among respondents, 63 percent said they had received a “significant” increase in their salary since 2018. Nearly four-fifths have lived in the UAE for more than six years. 

The dirham’s dollar peg has seen the UAE currency gain 21.2 percent versus the peso since the start of 2021, boosting the relative value of Filipino expats’ remittances. 

The Philippines was the fourth largest recipient of remittances worldwide in 2021 as Filipinos sent $37 billion home, up 4.3 percent year-on-year, the World Bank estimates. Only India, Mexico and China received more. 

As of 2020, remittances provided 9.6 percent of the Philippines’ GDP, according to the World Bank which forecasts remittances to the Philippines will rise 4.4 percent in 2022. 

Remittances from the UAE to the Philippines totalled $850.2 million in the first eight months of 2022, near-flat versus the prior-year period, data from the Philippines central bank shows.

Residential property prices in the Philippines grew 2.6 percent in the second quarter, versus a year earlier, according to central bank estimates.

Price increases in the region, including the capital Manila, were more pronounced, climbing 6.3 percent over the same period. 

Prices have rebounded following a steep decline at the start of the pandemic, with values still below pre-covid levels.