FDI net inflows reach $869M

Foreign direct investments (FDI) net inflows amounted to $869 million in November 2017, higher by 16.9 percent than the level posted a year ago.

This was due to the 13.1 percent expansion in non-residents’ net placements in debt instruments issued by local affiliates (intercompany borrowings) to reach $604 million.

Net equity capital inflows likewise grew by 38.7 percent to $210 million, as equity capital placements of $228 million more than offset the $18 million withdrawals.

The bulk of gross equity capital investments came from Singapore, Hong Kong, Luxembourg, China, and the United States. These were channeled mainly to manufacturing; real estate; electricity, gas, steam and air-conditioning supply; construction; and wholesale and retail trade activities. Meanwhile, reinvestment of earnings amounted to $56 million during the month.

As a result of these developments, FDI recorded net inflows of $8.7 billion in January to November, exceeding the $8 billion projection for 2017.

The sustained FDI inflows reflected investor confidence given the Philippine economy’s solid macroeconomic fundamentals and growth prospects.

Net FDI rose by 20.1 percent year-on-year, driven largely by the nine percent growth in net placements in debt instruments to $5.2 billion. Net investments in equity capital reached $2.8 billion from $1.8 billion in the comparable period in 2016, on account of the combined effect of higher equity capital placements ($3.3 billion from $2.4 billion) and lower withdrawals ($483 million from $555 million).

Equity capital infusions during the period were sourced mainly from the Netherlands, the United States, Singapore, Japan, and Hong Kong. The placements were invested largely in gas, steam and air-conditioning supply; manufacturing; real estate; construction; and wholesale and retail trade activities. Reinvestment of earnings reached $717 million. /