Net inflows of foreign direct investments in October 2018 declined 74 percent to $491 million from $1.9 billion a year ago, pulled down by lower investments of equity capital, Bangko Sentral ng Pilipinas said Friday.
The Bangko Sentral said investments of equity capital for the month reached $98 million, lower than the year-ago level of $1.5 billion due to the big ticket investments in October 2017.
On a gross basis, placements of equity capital reached $112 million, which mostly came from the Netherlands, the United States, Germany, Japan and Hong Kong.
These investments were channeled mainly to manufacturing, real estate, financial and insurance, electricity, gas, steam and air-conditioning supply, and wholesale and retail trade activities.
Investments in debt instruments—consisting mainly of inter-company borrowings/lending between foreign direct investors and their subsidiaries/affiliates in the Philippines—amounted to $331 million from $318 million in the same period in 2017.
Reinvestment of earnings increased 8.6 percent to $62 million in October 2018.
FDI net inflows in the first 10 months of 2018, however, increased 1.8 percent to $8.5 billion from $8.4 billion a year ago.
Net investments in debt instruments grew 18.6 percent to $5.9 billion. Reinvestment of earnings expanded 2.3 percent to $677 million during the period.
Meanwhile, net investments of equity capital declined to $2 billion from $2.8 billion in January-October 2017. Equity capital placements during the period were obtained largely from Singapore, Hong Kong, the United States, Japan and China.
These were infused largely to manufacturing, financial and insurance, real estate, arts, entertainment and recreation, and electricity, gas, steam and air-conditioning supply activities.
The Bangko Sentral is expecting a record net inflow of foreign direct investments in 2018 that will surpass the $10 billion net inflow in 2017, as the country’s macroeconomic fundamentals remain solid and strong.