Net inflows of foreign direct investments (FDI) in the Philippines climbed 27.8 percent in November 2023 to $1 billion from $820-million net inflows in the same period in 2022, the Bangko Sentral ng Pilipinas (BSP) said Monday.
The BSP attributed the uptick in FDI net inflows primarily to a 57.8-percent expansion in nonresidents’ net investments in debt instruments, which rose to $897 million from $568 million a year earlier.
Nonresidents’ net investments in equity capital (excluding reinvestment of earnings) and reinvestment of earnings saw declines of 52.5 percent and 8.1 percent, respectively, totaling $85 million from $180 million and $66 million from $72 million.
The majority of equity capital placements in November originated from Japan and the United States, with investments flowing into the manufacturing, real estate, and construction sectors.
These developments resulted in cumulative FDI net inflows of $7.6 billion in the first eleven months of 2023, marking a 13.3 percent decrease from the $8.7 billion recorded during the same period in 2022.
Despite sustained economic growth in the country, FDI remained subdued due to the lingering impact of high inflation and subdued global growth prospects, according to the BSP.
The Philippine economy, as measured by gross domestic product, expanded by 5.6 percent in 2023, falling short of the government’s target range of between 6 percent and 7 percent.
Inflation averaged 6 percent in 2023, up from 5.8 percent in 2022, exceeding the target range of 2 percent to 4 percent for the year, but remaining within the Development Budget Coordination Committee’s (DBCC) assumption of 5 percent to 6 percent.