Net foreign investments jump 32%

The country attracted more foreign-led job-generating investments during the second month of the Duterte administration on the back of sustained investor confidence, the Bangko Sentral ng Pilipinas said Thursday.

BSP data showed that net foreign direct investment (FDI) inflows reached $711 million in August, up 32 percent from $539 million in the same month last year.

The net inflows in August surpassed July’s $503 million, June’s $238 million and May’s $364 million. The August figure was, however, lower than the $2.244 billion in April.

In August, foreign investments in debt instruments or intercompany borrowings, which accounted for the bulk of FDI, grew by 44.2 percent year-on-year to $636 million.

Equity capital, other than reinvestment of earnings, however, dropped by 78.2 percent year-on-year to $8 million, even as placements of $49 million outpaced the $41 million in withdrawals. Net inflow in equity capital in August was also lower than July’s $23 million.

The BSP said gross equity capital placements mostly came from Hong Kong, Japan, the Netherlands, Singapore and the United States.

Equity capital were mainly infused into the following sectors: arts, entertainment and recreation activities; electricity, gas, steam and air-conditioning supply; manufacturing; real estate; as well as wholesale and retail trade.

Reinvestment of earnings increased by almost a tenth year-on-year to $67 million in August, also up from $63 million last July.

At the end of the first eight months, net FDI inflows totaled $5.406 billion, up 71.1 percent from $3.159 billion during the same period last year.

“The sustained FDI inflows were buoyed by investors’ confidence in the economy on the back of the country’s sound macroeconomic fundamentals,” the BSP said in a statement.

Net debt instruments climbed by 94.4 percent year-on-year to $3.417 billion.

As of end-August, net inflows of equity other than reinvestment of earnings grew 68.3 percent year-on-year to $1.476 billion, as the $1.705-billion placements exceeded the withdrawals worth $229 million.

Reinvestment of earnings during the eight-month period, however, declined by 2.3 percent year-on-year to $513 million.

The top sources of equity capital placements from January to August were Hong Kong, Japan, Singapore, Taiwan and the US.

The end-August FDI flows were primarily poured into accommodation and food service activities, construction, financial and insurance, manufacturing, and real estate.