Foreign Direct Investments Hit $1.6B in 1Q 2017

Manila—(PHStocks)—Bangko Sentral ng Pilipinas (BSP)—Foreign direct investments (FDI) registered $509 million net inflows in March 2017, higher by 30.6 percent than the $390 million recorded in the comparable period in 2016.

Investments in debt instruments (or lending by parent companies abroad to their local affiliates to fund existing operations and business expansion) contributed largely to FDI net inflows during the period, registering an increase of 75.1 percent to $445 million from $254 million last year.

Net equity capital investments amounted to $7 million as gross equity capital placements of $49 million more than offset the $42 million withdrawals. Equity capital placements during the month came mostly from the United States, Japan, Singapore, Hong Kong, and the Netherlands. These placements were largely invested in real estate; manufacturing; financial and insurance; wholesale and retail trade; and professional, scientific, and technical activities. Meanwhile, reinvestment of earnings grew by 16.1 percent to $56 million during the month.

On a cumulative basis, FDI posted $1.6 billion net inflows in the first quarter of 2017, increasing by 16.6 percent from $1.3 billion in the same period last year. The sustained FDI inflows reflect investors’ confidence in the country’s economy on account of continued growth prospects and strong macroeconomic fundamentals.

In particular, net investments in debt instruments more than doubled to reach $1.3 billion. Equity capital investments posted net inflows of $101 million, lower than the $550 million recorded in the same period in 2016. Equity capital infusions during the period – emanating largely from Japan, the United States, Singapore, Hong Kong and Germany –were channeled mainly to real estate; wholesale and retail trade; manufacturing; financial and insurance; and information and communication activities. Reinvestment of earnings grew by 6.7 percent to $193 million compared to the level in the same quarter last year.

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