IN 2019, the Bureau of the Treasury (BTr) entered into a partnership with the Financial Executives Institute of the Philippines (Finex) through the latter’s educational arm, the Finex Academy.
As BTr’s lead private sector partner for its Premyo savings bond issuance, Finex Academy promotes investor education focusing on these peso-denominated fixed-income securities with quarterly interest payments. The financially inclusive bonds carry corresponding raffle numbers through which randomly selected bondholders have a chance to win cash and non-cash prizes, including condo units.
With the overwhelming public response to the initial offering last year, the “Premyo Bonds Para Sa Bayan” or P2-billion offering was recently launched by the BTr and Finex Academy. This time, they tapped the Overseas Filipino Bank (OFBank) to ensure that Filipinos abroad would be able to purchase the P2-billion bonds conveniently.
Wholly owned by state-run Land Bank of the Philippines (Landbank), the OFBank is the country’s first branchless and digital-only bank. It provides reliable and secure banking solutions to overseas Filipino workers (OFWs) and their beneficiaries. Landbank acquired the century-old Philippine Postal Savings Bank in 2016 and converted it into OFBank, which officially opened in 2018.
OFWs are estimated to number 12.5 million scattered across more than 150 countries and territories in six continents. According to the latest data from the Department of Foreign Affairs (DFA), at least 20 percent of them are based in the Middle East–where many OFWs were treated like private property under the kafala system. This sponsorship system dates back to the 1950s, with the employers or kafeel–which means “to take care of” in Arabic–guaranteeing the protection of their migrant employees ranging from top executives to skilled workers and domestic helpers.
However, the system became prone to abuse by some employers who wanted absolute control of their employees. Case in point was the gruesome murder of OFW Joanna Demafelis by her Lebanese-Syrian employers in Kuwait two years ago. This triggered a diplomatic crisis and enraged President Rodrigo Duterte, who imposed a total deployment ban for Filipinos planning to work in the Arabian Gulf country.
Foreign Affairs Secretary Teodoro L. Locsin Jr. and his predecessor, Rep. Alan Peter S. Cayetano, were instrumental in the fight against the kafala system that kept OFWs in virtual bondage. Under Cayetano’s watch, the DFA led the charge in dismantling this abusive system by spearheading the international adoption of the Global Compact for Migration (GCM). At that time, he said “our experience in the promotion of the welfare and protection of the rights of Filipino migrants firmed up our commitment to stirringly advocate for the rights of all migrant workers.”
When the US withdrew from the United Nations campaign for a global agreement on migrant rights, the Philippines took the lead and Cayetano reached out to the country’s Western allies for support, ultimately resulting in the GCM’s signing. At the sidelines of the 2018 UN General Assembly in New York City, he reaffirmed the Philippines’s commitment to the GCM on behalf of all migrant workers worldwide.
Partnering with him in the crusade against this modern-day slavery was then Philippine Ambassador to the UN Locsin, who was part of the crucial negotiation process. Two months later, when the GCM was adopted during the intergovernmental conference held in the Moroccan city of Marrakech, Locsin had taken over the DFA portfolio and considered the GCM of personal importance to him.
“It provides a 360-degree approach to international migration governance, covering the whole cycle from pre-deployment to return and reintegration,” he emphasized.
The GCM is the first-ever UN agreement anchored on a comprehensive and holistic approach to all dimensions of international migration. It is grounded in the values of state sovereignty, human rights, responsibility sharing, and non-discrimination. Gulf countries such as Bahrain, United Arab Emirates, Kuwait, and Qatar have since made amendments to their labor laws effectively abolishing the kafala system.
Earlier this month, Saudi Arabia announced the easing of contractual restrictions on foreign workers starting March 2021. This will significantly improve the working conditions of some 800,000 OFWs who will be allowed to transfer to another employer without the current employer’s consent and to travel outside the desert kingdom without the employer’s approval.
Labor reform initiatives are also expanding beyond the Middle East. For instance, the Philippines and Canada are undertaking a joint project for the first government-to-government pilot testing of the international recruitment integrity system to promote ethical work principles. Such actions would allow future generations of OFWs to be from the shackles of poverty, intolerance, and slavery.
Joseph Gamboa is the co-chairman of the Finex Week 2020 Annual Conference, chairman of the Finex Business Columns Subcommittee, and director of Noble Asia Industrial Corp. The views expressed herein do not necessarily reflect the opinion of these institutions and the BusinessMirror.