Foreign direct investments recovered in May from three consecutive months of slump amid the onslaught of the COVID-19 pandemic, the Bangko Sentral ng Pilipinas said Wednesday.
The BSP data showed FDI net inflows grew 42.4 percent in May to $399 million from $280 million a year ago.
“The positive growth represents a reversal from the last three consecutive months of decline attributed largely to the weak global outlook and investors’ confidence following the pandemic. The stronger FDI performance during the month relative to the level last year was on account of the increase in non-residents’ net investments in equity capital and debt instruments,” the BSP said.
Net investments in debt instruments climbed 40.8 percent in May to $236 million from $168 million in the same month last year.
Equity capital placements also increased by 8.1 percent to $80 million from $74 million, while withdrawals decreased by 96 percent to $3 million from $73 million.
Equity capital infusions came mainly from Japan, Singapore and the United States, the economies which implemented gradual easing of containment measures. These were invested mostly in manufacturing, financial and insurance and real estate.
Meanwhile, reinvestment of earnings continued to be weak, dipping by 23.7 percent to $85 million from $111 million.
The BSP said, however, that FDI net inflows in the first five months declined by 25.6 percent to $2.379 billion from $3.196 billion a year earlier.
“Specifically, total placements in equity capital by May registered a growth of 4.8 percent from 4.4 percent in April. Meanwhile, total equity capital withdrawals for the first 5 months were lower compared to the same period in 2019. The cumulative net investments in debt instruments in May, while lower by 46.4 percent year-on-year, eased from 53 percent in April,” the BSP said.
Total reinvestment of earnings went down by 22.2 percent in May from a year ago.
Equity capital placements in the first five months originated mostly from the Netherlands, Japan and Singapore.
The BSP FDI statistics are distinct from the investment data of other government sources as they cover actual investment inflows, compared to commitments or approvals reported by investment promotion agencies.
