October net FDI inflows smallest in four months

THE PHILIPPINES saw fewer foreign capital inflows in October that hit a four-month low, although the year-to-date tally remained poised to meet the government’s forecast for 2016, the central bank announced yesterday.

Foreign direct investments (FDIs) posted a net $342 million for the month, dropping 27.08% from September’s $ 469 million and 14.29% from the year- ago $399 million, the Bangko Sentral ng Pilipinas ( BSP) announced yesterday.

October’s net inflow was the smallest since June’s $238 million — a month after the May 9 national elections.

FDIs are a key source of capital for the economy, generating gainful jobs for Filipinos.

A double-digit drop in investments of foreign firms in debt instruments of their Philippine units sustained the drop in monthly inflows for the second straight month, despite an increase in equity placements. Money placed in such debt securities dropped 20.3% in to $225 million in October from the yearago $282 million, and 24% from September’s $296 million.

Money which foreign firms chose to reinvest locally recovered 62.86% to $57 million from September’s $35 million, but still fell 8.5% from October 2015’s $62 million.

In contrast, net equity placements increased a 10th to $ 60 million from October 2015’s $55 million, but was just 43.48% of September’s $ 138 million. October saw $ 84- million gross placements — just more than half

September’s $157 million but still 35.8% more than October 2015’s $62 million — still offset $24 million in total outflows that were nevertheless 26.32% more than September’s $19 million and six times October 2015’s $8 million.

October saw foreign capital channelled to financial and insurance sectprs; manufacturing; real estate; construction; as well as accommodation and food service activities, the BSP said in a statement.