Net FDI surges 55% in November

MANILA, Philippines – Foreign direct investments continued to rise in November last year amid the country’s rosy economic prospects, the Bangko Sentral ng Pilipinas reported yesterday.

Data from the central bank showed net FDI inflows surged 54.9 percent to $286 million in November from $185 million in the same period in 2012.

Net equity capital reversed to an inflow of $7 million in November from an outflow of $21 million a year ago, while reinvested earnings fell 44.3 percent to $55 million from $98 million.

Gross equity capital placements mainly came from the United States, Japan, the United Kingdom, Hong Kong and Singapore, the central bank said.

These funds were put into manufacturing; electricity, gas, steam and airconditioning supply; real estate; mining and quarrying; and wholesale and retail trade activities.

Borrowings made by local subsidiaries from parent firms and placements in debt instruments, meanwhile, surged 108 percent to $225 million from $108 million on the back of expansion plans.

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“FDI inflows remained robust on the back of sustained investor confidence in the growth prospects of the economy,” the BSP said.

The Philippine economy expanded 7.2 percent last year, surpassing market and government expectations. The strong economic growth was matched by a stable inflation which averaged three percent in 2013.

In the 11 months to November, net FDI inflows went up 36.6 percent to $3.648 billion from $2.67 billion in the same period in 2012.

Equity capital fell 41.4 percent to $1.306 billion from $2.228 billion, while reinvested earnings slid 34.3 percent to $641 million from $976 million.

The BSP noted majority of gross equity capital placements came from Mexico, Japan, the United States, British Virgin Islands, and Singapore. The funds were invested mainly in manufacturing; water supply, sewerage, waste management and remediation; financial and insurance; real estate; and arts, entertainment and recreation activities.

Placements in debt instruments and borrowings made by local firms from parent companies, meanwhile, ballooned 423.9 percent to $2.342 billion from $442 million.

The current net FDI inflow as of November was already above the central bank’s $2.1 billion assumption for 2013. –Kathleen A. Martin (The Philippine Star)