MANILA, Philippines - The Philippines was able to attract more foreign direct investments (FDIs) in 2012, but the country still lagged behind most of its Southeast Asian peers.
Citing the United Nations Conference on Trade and Development (UNCTAD) World Investment Report 2013, Bangko Sentral ng Pilipinas (BSP) Economic Director Zeno Ronald Abenoja said FDI inflows grew 54% to $2.797 billion in 2012 from $1.82 billion in 2011.
"FDI flows to the Philippines have grown steadily in recent years. We have attracted a lot of investments from other region," he said.
Abenoja said the 2012 figure was the highest since 2007, when the Philippines received $2.56 billion FDIs.
He said the FDIs went to the manufacturing, real estate and financial sectors. The investments came from the US, Japan and other ASEAN countries.
However, the Philippines' FDIs were still "too small" compared to the volumes seen by peers in the region, said Asian Development Bank senior country economist Norio Usui.
The country's share in total FDIs ($326 billion) in East and Southeast Asia was less than 1% in 2012, according to the UNCTAD report.
ASEAN countries that got more investments than the Philippines in 2012 include:
Usui said deficient infrastructure, poor business climate and high wages have kept the Philippines from achieving its potential to become a prime investment destination.
Job creation missing link
Photo by Lean Santos/Rappler
Usui also cited the need for the government to create more high-quality jobs in key sectors such as manufacturing to address the gap between economic growth and development.
"There's a missing link. The Philippines has a very high economic growth but a slow poverty reduction," he said.
"The government should focus on job creation, but the jobs should be diverse and high quality," Usui said.
He said the government must take into consideration 3 factors in job creation: