Foreign direct investments still at only half of 2009 levels - BSP

Foreign direct investment (FDI) levels from January to July this year remain subdued compared to the highs of 2009, according to latest official figures from the Bangko Sentral ng Pilipinas (BSP), which attributes the decline to global economic factors. Cumulative first seven months’ worth of FDIs in 2010 and 2011 were roughly only half of what came in during 2009, which saw $1.634 billion of inflows compared to only $891 million last year and $805 million this year. “Renewed concerns on sovereign debt issues in Europe and a stalled recovery in the U.S. continued to weigh down on investor sentiment despite the Philippine economy’s continued favorable fundamentals," the BSP said in a statement. Since last January, foreign firms already entrenched in the Philippines reinvested $248 million of their earnings in the current operations while overseas parent companies and affiliates extended $321 million in trade credits. New equity placements reached $286 million so far this year and these came “mostly from the United States, Japan, Hong Kong, Republic of Korea, and Singapore…(and) channeled mainly to real estate, manufacturing, mining and quarrying, utilities, and wholesale and retail trade sectors." For the month of July alone, only $26 million of net FDI was posted this year compared to the much higher $222 million in 2010. Withdrawals of investments fell to $53 million from $204 million in the first seven months of 2010. — BC/ELR, GMA News