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Philippines: FDI inflow surges to $679 million in April
MANILA, Philippines — The net inflow of foreign direct investments (FDIs) more than doubled to $679 million in April from $317 million a year ago on the back of positive investor sentiment on the country’s macroeconomic fundamentals and strong growth prospects, according to the Bangko Sentral ng Pilipinas.
BSP Governor Benjamin Diokno said the 114 percent jump in FDI inflow in April was due to the 121 percent increase in non-residents’ net investment in debt instruments, consisting mainly of intercompany borrowings between foreign direct investors and their subsidiaries in the country, to $500 million from $226 million.
Equity capital placements coming primarily from Japan, the US and Singapore channeled to manufacturing and real estate soared by 131 percent to $97 million in April from $47 million in the same month last year.
On the other hand, equity pulled out from the Philippines fell by 75 percent to $11 million in April from $44 million a year earlier.
Likewise, reinvestment of earnings slipped by 6.2 percent to $82 million from $88 million.
“FDI net inflows in April 2021 rose on the back of positive foreign investor sentiment on the country’s macroeconomic fundamentals and strong growth prospects,” Diokno said.
From January to April, the BSP chief reported a 56 percent jump in net FDI inflow to $3.1 billion from $1.95 billion in the same period last year due to the improvements in all components.
Data showed net investment in debt instruments surged by 115 percent to $1.93 billion in the first four months from $897 million in the same period last year, while reinvestment of earnings inched up by two percent to $307 million from $301 million.
On the other hand, equity infusion remained almost unchanged at $936 million from $934 million. Equity capital placements coming mostly from Singapore, Japan, and the US were channeled to electricity, gas, steam, and air-conditioning, financial and insurance as well as manufacturing industries.
Withdrawals fell 33.5 percent to $118 million from January to April compared to last year’s $178 million.
Due to the pandemic-induced global recession, the net inflow of FDIs to the Philippines declined by almost 25 percent to hit a five-year low of $6.54 billion in 2020 from $8.67 billion in 2019. This was the lowest since the $5.64 billion recorded in 2015.
As the Philippines is seen recovering from the pandemic-induced recession, the BSP sees net FDI inflow bouncing back to hit $7.5 billion this year and $8.5 billion next year.
Source: https://www.philstar.com/business/2021/07/13/2112008/fdi-inflow-surges-679-million-april