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2023 foreign direct investments hit $8.9b

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Net inflows of foreign direct investments (FDI) reached $8.9 billion in 2023, the Bangko Sentral ng Pilipinas (BSP) said Monday.

The figure, however, was down 6.6 percent from the $9.5-billion net inflows recorded in 2022.

“Notwithstanding the country’s sound macroeconomic fundamentals, concerns over subdued global economic growth and geopolitical risks continued to weigh on investors’ investment plans,” the BSP said.

FDI net inflows in December rose 29.9 percent year-on-year to $826 million from the $636-million net inflows in the same month last year.

FDIs increased on the back of the 86.2-percent growth in non-residents’ net investments in debt instruments to $527 million from $283 million in the comparable month in 2022.

Reinvestment of earnings improved 4.1 percent to $91 million from $87 million.

Meanwhile, non-residents’ net investments in equity capital (other than reinvestment of earnings) declined by 21.7 percent to $208 million in December 2023 from $266 million a year ago.

Bulk of the equity capital placements in December came from Japan (51 percent) with investments directed mostly to the manufacturing industry.

This was followed by United States (13 percent), Singapore (12 percent) and Germany (8 percent).

Net FDI inflows hit an all-time high of $10.5 billion in 2021 at the height of the pandemic, before settling at $9.5 billion in 2022.

The BSP statistics on FDIs include investment by a non-resident direct investor in a resident enterprise, whose equity capital in the latter is at least 10 percent and investment made by a non-resident subsidiary/associate in its resident direct investor.

These data are distinct from those released by other government sources. The approved foreign investments data that are published by the Philippine Statistics Authority represent investment commitments, which may not necessarily be realized fully, in a given period.

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