The Bangko Sentral ng Pilipinas (BSP) registered $6.37 billion worth of net foreign direct investment (FDI) inflows for the first eight months, an increase of 39.7 percent from same period in 2020 of $4.56 billion.

For the month of August only, net FDI inflows rose by 19.8 percent to $812 million from $677 million same time in 2020.

FDIs as registered by the BSP are equity capital, reinvestment of earnings, and borrowings.

The BSP said the increase in the cumulative FDI net inflows was due to the 71.6 percent growth in non-residents’ net investments in debt instruments which amounted to $4.51 billion from $2.63 billion in 2020. Net investments in debt instruments consist mainly of intercompany borrowing/lending between foreign direct investors and their subsidiaries/affiliates in the Philippines.

As of end-August, reinvestment of earnings went up by 11 percent to $776 million from $699 million while non-residents’ net investments in equity capital other than reinvestment of earnings declined by 12.2 percent to $1.08 billion from $1.23 billion.

Net investments in equity capital, in the meantime, decreased in the first eight months as placements were down by 8.2 percent to $1.35 billion from $1.47 billion while withdrawals increased by 12.1 percent to $272 million from $243 million.

During the period, equity capital placements came from investors in Singapore, Japan, and the US. These funds were invested in the following sectors: manufacturing; financial and insurance; electricity, gas, steam, and air-conditioning; and real estate industries.

For the month of August, the BSP said the increase in FDI net inflows was attributed to non-residents’ net investments in debt instruments. This increased by 38 percent year-on-year to $636 million from $461 million same month last year.

The reinvestment of earnings fell by 24.7 percent in August to $99 million from $132 million.

In August, non-residents’ net investments in equity capital dropped by 9.7 percent to $77 million from $85 million because of a 51.2 percent increase in equity capital withdrawals. This offset the increase in equity capital placements by 7.3 percent to $126 million from $118 million.

For the full-year 2021, the BSP is projecting FDI net inflows will reach $7.8 billion. Last year, FDI net inflows amounted to $6.54 billion.


Source: Manila Bulletin (https://mb.com.ph/2021/11/10/8-month-fdi-net-inflows-reach-6-37b/?utm_source=rss&utm_medium=rss&utm_campaign=8-month-fdi-net-inflows-reach-6-37b)