November 2023 FDI net inflows highest in nearly two years
INVESTMENT in flows posted double- digit growth in November 2023 to mark the highest level in nearly two years, driven mainly by the expansion in debt instruments during the period, government data released on Monday, Feb. 12, showed.
The Bangko Sentral ng Pilipinas ( BSP) reported foreign direct investment ( FDI) net inflows at $ 1.048 billion in November, up 27.8% from $820 million the same month in 2022, and higher than the $ 655 million in October.
The latest showing is also the highest in nearly two years, since FDI net inflows came in at $2.662 billion in December 2021.
“This improvement was due mainly to the 57.8% expansion in nonresidents’ net investments in debt instruments to $897 million from $568 million a year ago,” the BSP said in an emailed statement.
This offset the contraction 52.5% drop in net investments in equity capital to $85 million, sourced largely from Japan and the United States, and channeled primarily to manufacturing, real estate, and construction.
Reinvestment of earnings for the month declined by 8.1% to $66 million from $72 million in November 2022. This is also lower than the $76 million in October.
Year-to-date FDI net in flows stood at $7.581 billion or 13.3% lower than the $ 8.741 billion in the comparable period of 2022 — net equity at $1.104 billion, reinvestment of earnings at $ 1.01 billion, and net debt instruments at $5.465 billion.
Japan, the United States, Singapore, ang Germany were the top country sources of equity capital placements for the first 11 month of the year, which were channeled into the manufacturing, real estate, and financial and insurance industries.
“Notwithstanding the country’s sustained economic growth, FDI remained subdued due to the lingering impact of high inflation and low growth prospects globally,” the BSP said.
The Philippine economy grew by 5.6% in 2023, slower than the 7.6% full-year growth in 2022 and lower than the government’s target range of 6.0% to 7.0%. The fourth- quarter economic growth was recorded at 5.6%, down from 7.1% the same period in 2022.
Inflation, meanwhile, averaged 6.0% in 2023, marking an acceleration from 5.8% in 2022, due mainly to the higher food prices during the year. ( GMA Integrated News)