By Lee C. Chipongian
The country’s net foreign direct investment (FDI) inflows amounted to $569 million in September, 29.4 percent lower than same time last year of $807 million, the Bangko Sentral ng Pilipinas (BSP) reported.
FDI covers actual investment inflows such as equity capital, reinvestment of earnings, and borrowings between affiliates.
FDI as of end-September, in the meantime, grew by 24.2 percent to $8 billion from $6.5 billion same time last year “on account of the increases registered in all FDI components.”
“Investment inflows continued, buoyed by investor confidence in the Philippine economy on the back of strong macroeconomic fundamentals and high growth prospects,” according to the BSP.
Investments in debt instruments went up by 19.6 percent year-on-year to $5.5 billion. Net equity capital investments also rose by 52.1 percent to $1.9 billion.
Majority of equity capital placements for the January-September period came from Singapore, Hong Kong, US, Japan, and China. “These investments were channeled largely to manufacturing, financial and insurance, real estate, arts, entertainment and recreation and electricity, gas, steam and air-conditioning supply activities,” said the BSP.
Reinvestment of earnings amounted to $614 million during the period, up 1.7 percent year-on-year.
For September, equity capital withdrawals totaled $187 million and it exceeded equity capital placements of $69 million. These equity were traced from investors in the US, Japan, Macau, Hong Kong and China.
These investments were placed in real estate, manufacturing and electricity, gas, steam and air-conditioning supply activities.
In September, debt instruments – which are intercompany borrowings/lending between foreign direct investors and their subsidiaries/affiliates in the Philippines – increased by 24.3 percent year-on-year while reinvestment of earnings amounted to $78 million, up 32.8 percent.