Western Union eyes project harnessing OFW money for community development
MANILA, Philippines—Global remittance giant Western Union has bankrolled a pioneering project that seeks to channel collective funds from overseas Filipinos for local development, picking the province of Ilocos Norte and the city of Taguig as its two pilot sites.
The two-year project was launched as a partnership among the United Nations Development Program, the Philippine government and Western Union Foundation (WUF), drawing lessons from similar diaspora projects successfully executed in Africa and Mexico by Western Union, which provided the seed money of $250,000 to jumpstart this project.
The project will test a mechanism to facilitate and direct overseas remittances toward savings and investment in livelihood improvement and entrepreneurship for the poor, ultimately creating jobs and reducing poverty in the Philippines, the world's fourth- largest recipient of overseas remittances after India, China and Mexico.
"The program intends to efficiently and accountably link hard monies from overseas to create sustainable small businesses that generate jobs and economic opportunity back home in the Philippines. Upon success, the model will be replicated in different parts of the world," said WUF president Luella Chavez D' Angelo, who flew in from Colorado USA, to launch the project.
The six-pronged project will involve facilitating governmental support for public policy inclusion of collective remittances, building awareness for the concept, organizing overseas Filipinos to pool funds, giving people at home the skills and capabilities to identify and carry out projects, promoting the concept and mobilizing funds and matching private funds with private funds.
Ilocos Norte and Taguig were picked as pilot sites not because of the number of migrant workers but because WUF believes these territories have a greater likelihood of embracing this concept.
In an interview with the Philippine Daily Inquirer, D'Angelo explained that this Philippine project could draw lessons from the successes of an earlier project rolled out by her foundation in Africa whereby a competition was launched targeting African diaspora in Washington, D.C., and New York to come up with business plans that would help development in the proponent's hometown. In that project, proponents were required to bring in their share of capital worth around $10,000 to $15,000 and the best proposals were chosen and WUF helped raise funds for the projects.
What WUF was hoping to accomplish in the Philippines, she said, would be to harness collective remittances among overseas Filipinos and hopefully get its agents and local government units to contribute cash to the pot and WUF would match the amount raised. In the African pilot, she said what was originally targeted to be a $500,000 project ended up leveraging $1.8 million.
WUF did not seek equity from local governments in Africa but in another project in Mexico, she said there was some contribution from the local leadership. But apart from equity, she said the program would need support from local governments by promoting awareness as well as making sure that local regulations would not get in the way of developmental objectives.
During the launch, Ilocos Norte Governor Imee Marcos and Taguig City councilor Aurelio Bartolome expressed support for the project. Likewise present was Commission on Filipinos Overseas Secretary Imelda Nicolas, who said: "The objective of harnessing remittances for local development is the next frontier for development banking."
"In our dealings with community leaders, we find that a lot of Filipinos that are well settled abroad are always looking for means to help the communities they left behind," Western Union senior vice president for Pacific and Indochina Patricia Riingen said.
That's where this project could help, Riingen said, noting for instance that if there's a certain town wishing to set up a “balut”-making industry, collective funds from abroad could be channeled to such activities.
"At Western Union, we believe that leaving home to work overseas should be a choice, not a necessity borne of lack of options. We share the dream that someday, people in the Philippines and in developing countries everywhere will have the option to stay with their families, that jobs and opportunities at home will provide a choice and that going overseas will be but one way to make a better life," Riingen said.
D' Angelo said WUF would measure the success of this project partly in terms of growth in collective remittances and increase in local businesses, particularly small and medium enterprises. A deeper assessment could be done with the help of the National Economic and Development Authority, she said.
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