Foreign direct investments stood at a net inflow in March

Foreign direct investments stood at a net inflow of $167 million in March, jumping 142 percent year-on-year, even as investors remained on guard over rising global concerns, according to the Bangko Sentral ng Pilipinas.

BSP Governor Amando M. Tetangco Jr. said in a statement that positive balances were recorded across all categories in March, including equity capital, reinvested earnings and “other” capital.

Net reinvested earnings and other capital yielded net inflows of $25 million and $96 million, respectively.

At the same time, net equity capital infusion amounted to $46 million – a turnaround from a net outflow of $4 million in the same month of 2010.

Results in March put the net FDI inflows in the first quarter to $471 million, or 16.6 percent less than the $565 million posted during the same period a year ago.

The decline was observed “as investors remained cautious on account of uncertainties brought about by the sovereign debt problems in Europe, political unrest in the Middle East and North Africa, and the disasters that struck Japan,” Tetangco said.

Capital other than equity and reinvested earnings accounted for bulk of FDI inflows in the first quarter with $277 million, dropping by 17.8 percent from the $337 million recorded in 2010. That capital consists mainly of intercompany borrowing and lending between foreign direct investors and their subsidiaries or affiliates in the Philippines.

Also, reinvested earnings showed a net inflow of $113 million, down by 38.3 percent from $183 million reported last year.

On the other hand, net equity capital inflows from January to March rose 80 percent to $81 million.

This was mainly on account of gross equity capital placements channeled to the real estate, manufacturing, and mining and quarrying sectors, which amounted to $121 million.

First quarter inflows came largely from the United States, Singapore and Hong Kong.