Foreign direct investments slower by 85% in May 2019

Ralf Rivas
Foreign direct investments slower by 85% in May 2019
Foreign direct investments in May hit a 4-year low at just $242 million

MANILA, Philippines – For the 4th time in 2019, foreign direct investments (FDI) plummeted and stood at just $242 million in May, 85.1% lower than the recorded $1.6 billion in 2018, said the Bangko Sentral ng Pilipinas (BSP).

The BSP said the dismal FDI figure was due to a decline in net investments in debt instruments from $1.3 billion last year to just $149 million this year.

“Moderate net inflows of equity capital amounting to $1 million from $241 million a year ago also contributed to the decline in FDI,” the BSP said.

This is the weakest FDI figure since March 2015’s $200 million.

Equity capital placements in May were sourced from the United States, Japan, Singapore, China, and Hong Kong.

These were invested largely in real estate, manufacturing, financial and insurance, construction, and human health and social work industries.

From January to May, FDI recorded net inflows of $3.1 billion, 37.1% lower than the $5 billion recorded a year ago. (READ: [ANALYSIS] The real score on foreign direct investments)

For the 1st 5 months of the year, equity capital placements were mostly from Japan, the US, China, Singapore, and South Korea.

These were channeled largely to financial and insurance, real estate, manufacturing, transportation and storage, and administrative and support service industries.

FDIs are investments where foreign companies buy equity or actually set up shop in the country.

Unlike portfolio investments or hot money, FDIs stick around longer and create more job opportunities for Filipinos. –

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.