Net foreign direct investment (FDIs) inflows reached $588 million in June, a turnaround from the $26-million net outflows in the same month last year, the Bangko Sentral ng Pilipinas (BSP) said in a statement.
“This developed as increases were registered across FDI major components,” the BSP said.
Bulk of FDIs -- which also help generate more jobs -- was made up of foreign parent’s placements in debt instruments issued by local affiliates amounting to a $459-million net inflow, up by more than threefold from the $108 million recorded in June 2013.
Equity capital investments also reversed a $192-million outflow seen a year ago at $54 million. Most of equity capital placements were channeled to real estate; manufacturing; transportation and storage; mining and quarrying; and administrative and support service activities. Funds came mainly from the United States, Singapore, Japan, Hong Kong, and Germany.
Reinvestment of earnings likewise went up 27% to $75 million from $59 million a year ago.
Results for June brought the first-semester FDI tally to a $3.572-billion inflow, which was 77% higher than the net $2.019 billion registered in the comparable 2013 period.
Increased FDI levels continued to reflect “strong investor confidence in the country’s solid macroeconomic fundamentals.”
Placements in debt instruments in the first half rose to $2.411 billion from $1.204 billion as foreign parent firms lent more to local affiliates to fund existing operations or expansion; net equity capital inflows increased to $762 million from $583 million; and reinvestments reached soared to $400 million from $232 million.
FDIs ended last year with a $3.86-billion net inflow, 20% more than the $3.215 billion recorded in 2012 and breaching the central bank’s full-year forecast of $2.1 billion.
For this year, the BSP expects net FDI inflows to reach $1 billion, down from an initial estimate of $2.6 billion. -- Daryll Edisonn D. Saclag
source: Businessworld
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