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Friday, March 29, 2024

Foreign investments declined 61% in April

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Net inflows of foreign direct investments fell 61 percent in April to $874 million from $2.244 billion a year ago, in the absence of major equity capital infusion this year, data from Bangko Sentral ng Pilipinas show.

Net equity capital investments plummeted 92 percent in April to $70 million from $825 million a year ago, when the Bank of Tokyo-Mitsubishi UFJ Ltd. acquired a 20-percent equity in Security Bank Corp.

Bangko Sentral said the $70-million net equity capital investments in April resulted from gross equity infusion of $84 million and withdrawals of $14 million.

“Gross equity capital placements of $84 million, which exceeded withdrawals of $14 million in April 2017, were channeled mainly to real estate; financial and insurance; electricity, gas, steam and air-conditioning supply; manufacturing; and human health and social work activities,” Bangko Sentral said. 

The bulk of these equity capital placements came largely from the United States, Japan, Singapore, France and Hong Kong.

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Net inflows of FDIs also declined 32 percent in the first four months to $2.434 billion from $3.581 billion in the same period last year.

Bangko Sentral said the sustained net inflows, although lower compared to the same period last year, showed investors’ confidence in the country’s sound macroeconomic fundamentals.

Net equity capital investments in the first four months were registered at $170 million, down from $1.4 billion a year ago. These were sourced mainly from Japan, the US, Singapore, Hong Kong and Germany.

These funds were invested in real estate; financial and insurance; wholesale and retail trade; manufacturing; and electricity, gas, steam and air-conditioning supply activities.

Bangko Sentral earlier raised the FDI net inflow target this year to $8 billion from the previous estimate of $7 billion.

Bangko Sentral Deputy Governor Diwa Guinigundo said the regulator took into consideration in adjusting upward the FDI target the actual net inflow of $7.9 billion in 2016.

The FDI net inflow of $7.9 billion last year surpassed the target of $6.7 billion. The 2016 figure was also 40.7 percent higher than $5.72 billion in 2015.

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