Foreign direct investment net inflows into the Philippines reached $642 million in October 2025, led by strong interest from Japanese investors and the financial sector, Bangko Sentral ng Pilipinas data showed on Monday.
The October figure was higher than $320 million in September but lower than $1.067 billion recorded a year earlier.
This brought the cumulative net inflows for the first 10 months of the year to $6.2 billion, down from $8.2 billion registered in the same period in 2024.
The year-to-date equity capital placements came mainly from Japan, the United States and Singapore, the BSP said.
The financial and insurance sectors emerged as the primary recipients of the inflows in October. For the January to October period, the manufacturing, wholesale and retail trade and real estate industries received the bulk of the foreign capital.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the decline in FDIs was largely due to investors’ “wait-and-see” attitude amid the flood control corruption scandal. This was, however, offset by lower policy rates that reduced borrowing costs.
Ricafort said improved governance could help rebuild foreign investors’ confidence in local enterprises.
“FDIs could improve in 2026 if anti-corruption measures and other reforms related to further improving governance standards are taken seriously, as these are also the basis for the catch-up government spending to make up for the underspending in the latter part of 2025,” he said.
The BSP said its statistics follow the balance of payments and International Investment Position Manual, 6th Edition (BPM6).
Under these standards, FDI includes investments where a nonresident investor holds at least 10 percent equity in a resident enterprise. These figures represent actual net inflows, which account for equity capital placements minus withdrawals, along with reinvestment of earnings and borrowings.
The BSP data differ from the investment commitments published by the Philippine Statistics Authority (PSA).
While PSA data reflects approvals from investment promotion agencies that may be realized in the future, the BSP figures track the actual movement of capital into the economy.
The BSP remains the primary authority for tracking these net flows, which are often cited by economists to gauge the long-term confidence of global investors in the Philippine market.
If converted at current market rates, these billions of dollars represent significant additions to the peso denominations of the local economy.
