Net inflows of foreign direct investments surged 182.7 percent in June to $674 million from $238 million a year ago, as foreign companies continued to support local operations, the Bangko Sentral ng Pilipinas said Monday.
The Bangko Sentral said in a statement the higher FDI figure in June was led by the expansion of debt instruments”•or inter-company borrowings by local subsidiaries/affiliates from parent companies”•to $674 million.
Equity capital investments, however, posted net withdrawals of $72 million in June as placements ($113 million) were outpaced by withdrawals ($185 million).
“Equity capital placements in June came mostly from the United States, Japan, Taiwan, Singapore and India. These were channeled to real estate; electricity, gas, steam and air conditioning supply; financial and insurance; manufacturing; and professional, scientific and technical activities,” the Bangko Sentral said.
Data showed despite the higher figure in June, total net inflows of FDIs in the first half declined 14 percent to $3.6 billion from $4.2 billion a year earlier, pulled down by the 90.3-percent decrease in net equity capital to $141 million from $1.4 billion a year ago.
Equity capital infusions in the six-month period came mainly from the US, Japan, Singapore, Hong Kong and Taiwan. These were invested in real estate; financial and insurance; manufacturing; electricity, gas, steam and air-conditioning supply; and wholesale and retail trade.
Higher investments in debt instruments and reinvestment of earnings were registered in the first half, amounting to $3 billion and $416 million, respectively.
The Bangko Sentral earlier raised the FDI net inflow target this year to $8 billion from the previous estimate of $7 billion.
Bangko Sentral Deputy Governor Diwa Guinigundo said the regulator also took into considerationthe actual net inflow of $7.9 billion in 2016, which surpassed the target of $6.7 billion. The 2016 figure was also 40.7 percent higher than $5.72-billion net inflow in 2015.
The Bangko Sentral revisits the assumptions for foreign direct investments, hot money and other economic data twice a year.