FDI net inflows down 61.1% to $874M in April

MANILA, Philippines – Foreign direct investments (FDIs) hit net inflows of nearly $900 million in April 2017, but were still down 61.1% compared to the same month in 2016, according to the Bangko Sentral ng Pilipinas (BSP).

Data released by the BSP on Monday, July 10, showed that FDI net inflows last April totaled $874 million, compared to the $2.24 billion in April 2016.

The drop was due mainly to net equity capital investments, which amounted to $70 million in April 2017 from $825 million in April 2016.

Gross equity capital placements of $84 million, compared to withdrawals of $14 million, were channeled mainly to real estate, financial and insurance, electricity, gas, steam, and air conditioning supply, manufacturing, and health and social work activities.

The bulk of these equity capital placements during the period came largely from the United States, Japan, Singapore, France, and Hong Kong.

Investments in debt instruments or intercompany borrowing between parent firms and their subsidiaries in the Philippines also declined to $723 million in April 2017 from the $1.3 billion in April 2016.

Reinvestment of earnings, meanwhile, increased by 9.3% to $81 million.

FDIs down so far this year

For comparison, the $2.24 billion in April 2016 alone almost equals the total FDI inflows in the first 4 months of 2017.

For January to April this year, preliminary net inflows totaled $2.4 billion, down 32% compared to the $3.6 billion posted in the same period a year ago.

This, the BSP noted, was due to net equity capital investments falling sharply to $170 million in January to April 2017, from $1.4 billion in January to April 2016.

Equity capital placements during the period were sourced mainly from Japan, the US, Singapore, Hong Kong, and Germany. These were invested mainly in real estate, financial and insurance, wholesale and retail trade, manufacturing, and utilities.

Meanwhile, net investments in debt instruments grew moderately by 2% to hit $2 billion. Reinvestment of earnings reached $274 million, up 7.5% compared to the $255 million last year. – Rappler.com