FDI net inflows dropped to 13-month low in June, BSP says

Foreign direct investments (FDIs) into the Philippines slipped to a 13-month low in June as there were less investments in debt instruments during the month, the Bangko Sentral ng Pilipinas (BSP) reported Monday. 

Data released by the central bank showed that FDI net inflows were recorded at $471 million in June, 51.5% lower than the $971 million in June 2021, and down from the $742 million in May.

This is the lowest in 13 months since FDI net inflows stood at $455 million in May 2021.

“In June 2022, FDI net inflows declined following the drop in non-residents’ net investments in debt instruments of their local affiliates due to higher repayments during the month,” the BSP said in an accompanying statement.

“This muted the increase in their net investments in equity capital and reinvestment of earnings,” it added.

Net investments in debt instruments for the month were recorded at $215 million, down from $544 million in May and $764 million in June 2021.

Net investments in equity capital increased to $131 million from $91 million in May and $93 million in June 2021, while reinvestment of earnings climbed to $124 million from $106 million in May and $108 million in June last year.

Equity capital placements for the month came mostly from Japan, the United States, and Switzerland, and these were channeled mainly to manufacturing; real estate; and information and communication.

Year-to-date FDI net inflows increased to $4.641 million from $4.503 million in the comparable period of 2021, reflecting a 3.1% increase.

“Said cumulative growth was due to the expansion in non-residents’ net investments in debt instruments, which more than offset the decrease in their placements of equity capital,” the BSP said. — RSJ, GMA News