July foreign investments rose 2%

Foreign direct investments rebounded with a 1.6-percent growth in July, supported by higher net equity capital infusions, Bangko Sentral ng Pilipinas said Monday.

Data showed net inflows of FDIs reached $458 million in July, up 1.6 percent from $451 million registered in the same month last year.

Net equity capital investments increased 45.3 percent in July to $152 million, as the $173-million capital infusions exceeded withdrawals of $21 million during the month. 

The bulk of the equity capital placements came from Singapore, Hong Kong, the United States, Japan and the United Kingdom. 

These foreign capital went to the financial and insurance, mining and quarrying, real estate, manufacturing, and wholesale and retail trade activities. 

Financial and insurance activities captured almost half of the increase in total equity capital placements during the period, reflecting investors’ confidence in the country’s sound financial system. 

Bangko Sentral said despite the higher capital placements in July, net inflows of FDIs in the first seven months still fell 35.2 percent to $2.477 billion from $3.824 billion a year ago.

“Net equity capital placements increased marginally by 1 percent to $805 million from $797 million last year. This was not enough to offset the large declines in investments in debt instruments [by 51.6 percent] and reinvestment of earnings [by 12.7 percent],” Bangko Sentral said.

Equity capital placements in the seven-month period hit $1 billion, which came mostly from the United States, Singapore, Hong Kong, Japan and Germany.

These were invested in manufacturing, financial and insurance, real estate, electricity, gas, steam and air-conditioning supply and mining and quarrying activities.

Foreign direct investments posted a record $6.2-billion net inflow in 2014, up by 65.9 percent from $3.737 billion registered in 2013.

Bangko Sentral in May said full-year FDIs in 2015 would likely reach $6 billion.

Bangko Sentral’s statistics on foreign direct investments cover actual investment inflows, which could be in the form of equity capital, reinvestment or earnings, and borrowings between affiliates.

FDI data include investments where ownership by the foreign enterprise is at least 10 percent.

Meanwhile, FDI data of investment promotion agencies such as the Board of Investments and Philippine Economic Zone Authority do not reflect the 10-percent threshold and include borrowings from foreign sources that are non-affiliates of the domestic company.

Topics: Foreign Investment , BSP
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