Foreign investment pledges plunge 45%

By Czeriza Valencia (The Philippine Star), Dece. 21, 2016

MANILA, Philippines – Foreign investment pledges approved by the country’s seven investment promotion agencies (IPAs) fell 45 percent in the third quarter this year, the Philippine Statistics Authority (PSA) reported yesterday.

The IPAs include the Board of Investments (BOI), Clark Development Corp. (CDC), Philippine Economic Zone Authority (PEZA), Subic Bay Metropolitan Authority (SBMA), Authority of the Freeport Area of Bataan (AFAB), BOI-Autonomous Region in Muslim Mindanao (BOI-ARMM), and Cagayan Economic Zone Authority (CEZA).

Investments committed from July to September totaled P26.7 billion, lower than the P48.6 billion pledged in the same period last year.

In the first nine months of the year, approved foreign investments dropped 12.4 percent to P93.3 billion from P106.6 billion in the same period in 2015.

Most of the foreign investments approved in the third quarter originated from South Korea, the US and Singapore.

South Korea committed P6.5 billion, corresponding to 24.3 percent of total, while the US and Singapore pledged P4.6 billion and P4.1 billion, respectively, corresponding to 17.2 percent and 15.3 percent of approved investments.

By industry sector, 49.4 percent of the investment commitments were made in the electricity, gas, steam and air conditioning supply worth P13.2 billion. Manufacturing cornered total investments valued at P5.1 billion (18.9 percent of total) while transportation and storage had total investments of P3.5 billion (13.2 percent of total).

By location, the bulk of foreign investment pledges approved in the third quarter of the year – P5.5. billion or 20.4 percent of the total – would finance projects in the National Capital Region. Other prominent investment destinations are: Soccsksargen (P4.7 billion, 17.7 percent of total) and Negros Island Region (P4.5 billion, 16.9 percent of total).

Combined investments of foreign and Filipino nationals in the third quarter reached P133.8 billion, down 20.4 percent from P168.2 billion in the same period last year.

All projects approved by the seven IPAs in the third quarter are expected to create 33, 590 jobs, out of which 83.2 percent would come from projects with foreign interest.

Foreign investments approved by the investment promotion agencies differ from actual investment inflows reported by the central bank.