This was despite the numerous trade missions in the past and the government’s declaration that foreign investors were coming in following the strengthening of the economy and the investment-grade ratings from international agencies.
The amount of foreign investments approved last year by seven investment promotion agencies (IPAs)—Authority of the Freeport Area of Bataan, Board of Investments, BOI-Autonomous Region in Muslim Mindanao, Cagayan Economic Zone Authority, Clark Development Corp., Philippine Economic Zone Authority and Subic Bay Metropolitan Authority—was lower by 31.8 percent than the P274 billion committed by foreigners in 2013, National Statistical Coordination Board (NSCB) documents showed. IPAs offer tax and other incentives to attract investors.
In the fourth quarter of 2014, foreign investments registered by the seven IPAs also dropped 27.9 percent to P95.2 billion from the P132 billion generated during the last three months of 2013.
The fourth-quarter haul was nonetheless higher than the approvals during the first three quarters combined totaling P91.7 billion. IPAs attracted foreign investment commitments worth P37.4 billion in the first quarter, P36 billion in the second quarter, and P18.3 billion in the third quarter.
During the fourth quarter, P54.4 billion or 57.2 percent of the foreign investment pledges were in the manufacturing sector. Foreigners’ commitments to invest in administrative and support services totaled P18.8 billion, while construction projects amounted P7.6 billion.
During the October-to-December period, Netherlands was the biggest source of foreign investments with P23 billion or almost a fourth of the total, followed by Japan (P20.9 billion) and the United States (P9.7 billion).
When combined with investment commitments of Filipino companies, the seven IPAs approved a total of P231.2 billion during the fourth quarter of last year, down 1.9 percent from P235.7 billion in the same period of 2013.
The amount of Filipino-led investments in the fourth quarter—at P136 billion—outpaced those by foreigners.
The local- and foreign-led projects approved by IPAs between October and December would generate 61,424 jobs, up 30.7 percent from the 46,997 jobs to be created by approvals made during the fourth quarter of 2013.
While the value of approved foreign investments in the fourth quarter was lower, these would create 43,638 jobs or 71 percent of the total.
NSCB defines “foreign investments” as “investments made to acquire a lasting interest by a resident entity in one economy in an enterprise resident in another economy” wherein “[t]he purpose of the investor is to have a significant influence, an effective voice in the management of the enterprise.”