FDI net inflows hit USD 3-B mark in first eight months of 2015

MANILA, Nov. 10 (PNA) — Foreign direct investments (FDI) posted net inflows of USD 526 million in August 2015, an increase of 76.3 percent from the USD 299 million recorded in the same period last year.

This was due to more than seven-fold increase in investments in debt instruments (or inter-company borrowings from foreign direct investors by their subsidiaries/affiliates in the Philippines) to USD 431 million from USD 59 million.

The increase in debt instruments more than compensated for the decline in net equity capital investments during the period.

Meanwhile, net equity capital investments decreased by 81.2 percent as equity capital placements declined by 75.9 percent to USD 45 million and equity capital withdrawals increased by 43.1 percent to USD 11 million.

The bulk of equity capital investments during the month emanated largely from the United States, Japan, Singapore, Taiwan and Ireland.

Equity capital investments were channeled mainly to manufacturing; real estate; professional, scientific and technical; wholesale and retail trade; and information and communication activities. Reinvestment of earnings increased by 2.8 percent to USD 61 million during the month.

On a cumulative basis, net inflows of FDI reached USD 3 billion for the period January-August 2015, albeit lower by 27.1 percent than the USD 4.1 billion net inflows recorded in the comparable period last year. This resulted as all FDI components recorded lower net inflows during the period.

In particular, the USD 1.6 billion net inflows in investments in debt instruments were lower by 35.8 percent for the period January-August 2015, compared to the USD 2.6 billion net inflows in the previous year.

In addition, investments in equity capital registered net inflows of USD 839 million from USD 978 million last year.

The bulk of equity capital placements during the period came from the United States, Singapore, Japan, Hong Kong, and Germany. By economic activity, equity capital investments were mainly channeled to manufacturing; financial and insurance; real estate; wholesale and retail trade; and electricity, gas, steam and air conditioning activities.

Reinvestment of earnings declined by 11.2 percent to USD 525 million during the period. (PNA)