Foreign investment pledges down 51.8%

Investment pledges made by foreign firms slid 51.8 percent to P105.6 billion in 2017 after a steep 82.8-percent drop in fourth-quarter commitments, the Philippine Statistics Authority reported yesterday.

The latest PSA data showed that foreign investments approved by the country’s seven investment promotion agencies (IPAs) last year declined from P219 billion in 2016.

The PSA data covered the project approvals made by the 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.

IPAs extend fiscal and nonfiscal incentives to investors.

When these foreign investment pledges materialize, usually after a couple of years, they are then counted as foreign direct investment inflows.

In the fourth quarter of 2017, foreign investment commitments fell to a mere P21.6 billion from P125.7 billion in the same in 2016.

PSA data showed that foreign investors’ pledges declined year-on-year in five of the first six quarters of the Duterte administration’s term.

It was only in the third quarter of 2017 that foreign firms’ pledges jumped 61.1 percent year-on-year to P43 billion.

Foreign investment pledges fell by 12.8 percent year-on-year to P22.9 billion in the first quarter and by 55 percent to P18.2 billion in the second quarter last year.

In 2016, approved foreign investments declined 9.3 percent year-on-year in the fourth quarter after commitments dropped by a faster 45 percent to P26.7 billion in the third quarter.

But when combined with commitments from local investors, total IPA approvals in 2017 reached P911.3 billion, up 32.9 percent from P685.9 billion in 2016.

Filipino-led investments hit P805.7 billion last year, up 72.5 percent from P466.9 billion in 2016.