FDI net inflows hit six-month high in October

Foreign direct investments into the Philippines grew last October to mark the highest level in six months due to higher inflows in debt instruments and equity capital, but this was not enough to offset the declines recorded in the previous months.

Data released by the Bangko Sentral ng Pilipinas (BSP) recorded FDI net inflows at $923 million in October 2022, higher than the $626 million in September and $868 million in October 2021. It is also the highest since net inflows stood at $1.024 billion in April last year.

“Despite the global economic headwinds, FDI net inflows rose on account of the increase in non-residents’ net investments in debt instruments and equity capital of their local affiliates,” the BSP said in an accompanying statement.

The biggest equity capital placements for the month came from Japan, the United States, and Singapore, which were then channeled into financial and insurance; manufacturing; and the real estate sector.

The latest figures brought the cumulative net inflows to $7.635 billion from January to October, reflecting an 8.3% decline from the $8.3-billion net inflows in the comparable period of 2021.

Broken down, equity capital placements were channeled into manufacturing which accounted for 30%, real estate at 18%, financial and insurance at 17%, construction at 11%, information and communication at 8%, and other sectors at 16%.

The Joint Foreign Chambers of the Philippines (JFC) in December said it targets $128-billion worth of FDIs into the Philippines by the end of 2030, citing legislative reforms.

Former President Rodrigo Duterte in March signed a law amending the Public Service Act, effectively allowing foreigners to fully own public services such as telecommunications and railways, among others.

He also approved amendments to the Retail Trade Liberalization Act, which removed the categorization of enterprises, and cut down the minimum paid-up capital of foreign retailers to P25 million from $2.5 million.

The Department of Energy (DOE) in November also amended a section of the implementing rules and regulations (IRR) of the Renewable Energy (RE) Act of 2008, allowing foreign investors or companies to engage in the exploration, development, and utilization of Philippine renewable energy sources.—AOL, GMA Integrated News