Net inflows of foreign direct investments jumped 61.8 percent in September to $754 million from $466 million a year ago, bringing total inflows in the first nine months to $5.84 billion.
The Bangko Sentral ng Pilipinas said this meant foreign investors remained attracted to the Philippines given its “strong macroeconomic fundamentals and high growth prospects.”
Net equity capital investments in September increased 31.8 percent to $182 million, as gross placements amounting to $194 million more than offset withdrawals of $12 million.
Foreign infusion came mostly from the United States, Singapore, the Netherlands, China and Japan. These were invested mainly in construction; professional, scientific and technical; manufacturing, real estate, and accommodation and food service activities.
Net inflows in January to September hit $5.84 billion, nearly unchanged from $5.85 billion a year ago. Net equity capital in the nine-month period recorded lower inflows of $1.1 billion, compared to $1.6 billion a year earlier.
These came mainly from the US, Singapore, Japan, the Netherlands, and Hong Kong and were invested mainly in manufacturing, real estate, wholesale and retail trade, financial and insurance and construction activities.
Bangko Sentral officials earlier said inflows of foreign direct investments this year would likely match the $8 billion recorded in 2016. They also downplayed concerns by some quarters that the country was losing its attractiveness to foreign businessmen.
The Bangko Sentral said prospects for inward FDI flows continued to be favorable as both “push” (subdued global economic growth) and “pull” (sustained robust macroeconomic performance and investment grade status) factors remained.
Global debt watcher Fitch Ratings raised its investment grade score of the Philippines by a notch to “BBB” from “BBB-“ with a stable outlook, citing the country’s solid macroeconomic
fundamentals backed by the government’s economic reforms that sustained economic growth.
The economy grew 6.7 percent in the first three quarters, within the government’s official target range of 6.5 percent to 7.5 percent this year.
FDI net inflows reached a record $7.9 billion in 2016, surpassing the target of $6.7 billion. The 2016 figure was also 40.7 percent higher than $5.72 billion recorded in 2015.
The National Economic Development Authority earlier assured that foreign investors remained confident to do business in the country despite a 14-percent decline in FDIs in the first half. Julito G. Rada
Neda said the present administration’s economic team was pushing to strengthen the country’s macro-fundamentals through the Tax Reform for Acceleration and Inclusion bill, which is expected to have
a tax yield of P133.8 billion if passed in and enacted into law.
The tax reform package is a crucial component of the government’s massive infrastructure program called “Build, Build, Build.”