The Philippines suffered a net outflow of foreign direct investments in March, according to the Bangko Sentral ng Pilipinas.
The BSP reported Monday that in March, more foreign funds went out than came in, resulting in a net outflow of $78 million, a reversal from the net inflow of $179 million in the same month last year.
In the first quarter, however, the Philippines managed to record a net inflow of $1.3 billion, down by 8.5 percent from the net inflow of $1.42 billion in the same period last year.
Gross inflow of FDI reached $2.1 billion in the first quarter, up by 39 percent from $1.51 billion in the same period last year.
Outflow accelerated in the first quarter, however, to $799 million, nine times the $86 million recorded in the same period last year.
Government economic officials said the unfavorable development could be partly attributed to discouraging events abroad, such as the crisis in Cyprus that was feared to exacerbate or prolong the economic turmoil in the entire euro zone.
Economists, however, said that while external problems drag the ability of emerging markets like the Philippines to attract investments, domestic factors were likewise to blame.
There is a consensus among economists that the Philippines still lacks infrastructure, and that it remained difficult to set up a business in the Philippines.
They noted that the Philippines, which recorded one of the fastest growth economies in Asia last year, continued to significantly lag behind most of its neighboring countries in terms of FDI.
Indonesia, for instance, was reported to have cornered $6.7 billion in gross FDI in the first quarter.
Government officials, however, have expressed confidence that the Philippines may catch up with its neighbors in terms of FDI over the medium term, especially after it got investing ratings earlier this year.
In late March, Fitch Ratings raised its credit rating for the Philippines by a notch from BB+ to the minimum investment grade of BBB-, the minimum investment grade.
Standard & Poor’s followed suit in May.