Net inflows of foreign direct investments jumped 123 percent in January to $587 million from $263 million a year ago, on investors’ sustained confidence in the Philippine economy, Bangko Sentral ng Pilipinas said Monday.
“This developed as all FDI components recorded increases, signaling investor optimism in the growth potential of various local industries,” Bangko Sentral said in a statement.
Net equity capital inflows rose 10 times to $257 million, contributing the largest to the investment’s growth in the period.
“This was on account of the surge in equity capital placements of almost five-fold to $260 million, while withdrawals amounted to $3 million only during the month,” it said.
Equity capital placements came mainly from Hong Kong, the Bahamas, Taiwan, the United States and Singapore. The bulk of these placements were channeled to financial and insurance; real estate; electricity, gas, steam and air-conditioning supply; manufacturing/ and information and communication activities.
Net investments in debt instruments, or lending by parent companies abroad to their local affiliates to fund existing operations and business expansion, also increased 54.3 percent to $257 million from $167 million in January 2015.
Reinvestment of earnings rose 3.7 percent to $73 million.
Bangko Sentral’s statistics on foreign direct investments cover actual investment inflows, which could be in the form of equity capital, reinvestment or earnings and borrowings between affiliates.
Bangko Sentral’s FDI data include investments where ownership by the foreign enterprise is at least 10 percent.
Net inflows reached $5.72 billion in 2015, or 5 percent below the $6-billion target. It was also 0.3 percent lower than the revised $5.74 billion net inflows in 2014.
Debt instruments declined to $3.1 billion in 2015 from $3.3 billion in 2014, while reinvestment of earnings fell 14.8 percent to $747 million.
Net placements in equity capital increased by 15.1 percent to $1.8 billion from $1.6 billion, partially compensating for the declines registered in the other FDI components.
Equity capital placements originated mainly from the United States, the Netherlands, Japan, the United Kingdom and Singapore.
These funds were infused mainly into manufacturing; financial and insurance; real estate; wholesale and retail trade; and construction activities.
Bangko Sentral expects net inflows of FDIs to hit $6.3 billion in 2016, on the back of improving global economic conditions and robust domestic economy.
Bangko Sentral said the implementation of various private-public partnership projects, particularly in infrastructure, would give a strong signal to investors, boosting their confidence to invest in the country.