FDI net inflows reaches USD1-B in April 2018

BSP data released Tuesday show that the bulk of the net inflows in April 2018 was in the form of debt instruments (or lending by foreign companies abroad to their local affiliates to fund existing operations and business expansion), which amounted to USD705 million. (Shutterstock photo)

MANILA — Foreign direct investments (FDIs) into the country reached USD1 billion in April 2018 as positive balances were recorded for all FDI components during the month, Bangko Sentral ng Pilipinas (BSP) data show.

BSP data released Tuesday show that the bulk of the net inflows in April 2018 was in the form of debt instruments (or lending by foreign companies abroad to their local affiliates to fund existing operations and business expansion), which amounted to USD705 million.

Net investments in equity capital amounted to USD247 million as gross equity capital placements increased more than three times to USD262 million from US$84 million, while withdrawals remained broadly low at USD15 million, it said.

Equity capital placements emanated largely from Singapore, Hong Kong, Netherlands; the United States and Japan.

These were mainly invested in manufacturing; arts, entertainment and recreation; real estate; financial and insurance; and wholesale and retail trade activities.

Meanwhile, reinvestment of earnings by non-resident investors amounted to USD75 million during the month.

FDI for the first four months of this year (January–April 2018) posted net inflows of USD3.2 billion, representing a growth of 24.3 percent from the comparable period in 2017, BSP data also showed.

FDI inflows were boosted by continued favorable investor sentiment on the back of the country’s solid macroeconomic fundamentals and growth prospects.

During the four-month period, net equity capital investments grew by more than five times to USD1.1 billion from USD199 million last year as gross placements of USD1.3 billion more than offset the withdrawals of USD124 million.

Equity capital placements during the period were sourced largely from Singapore, Hong Kong, China, Japan, and the United States.

These were channeled primarily into manufacturing; financial and insurance; arts, entertainment and recreation; real estate; and electricity, gas, steam and air-conditioning supply activities. Debt instruments amounted to USD1.8 billion, lower by 14.5 percent than USD2.1 billion recorded in the comparable period last year.

Meanwhile, reinvestment of earnings reached USD268 million in the first four months of 2018.