by Louise Maureen Simeon – The Philippine Star, 10 Sep 2021
MANILA, Philippines — Foreign investments in the country improved in the second quarter as the economy gradually reopened, but remain far behind local funders in the overall tally.
Latest data from the Philippine Statistics Authority (PSA) showed foreign firms have slowly returned and are putting back much-needed capital to revive the economy.
Approved foreign investments in the second quarter jumped by nearly 46 percent to P22.5 billion from the 2020 level of P15.46 billion.
However, total investments from both foreign and Filipino entities plunged 86 percent to P82.78 billion. Over 70 percent of this came from local investors.
Still, the percentage of foreign investment to the total has improved to 23 percent in the second quarter compared with its measly three percent contribution in the same period last year amid the COVID-19 pandemic.
For the first semester, foreign investments reached P42 billion, still six percent below the P44.6 billion in the comparative period last year.
For the second quarter, foreign investment commitments were filed at the Board of Investments (BOI), Clark Development Corp., Philippine Economic Zone Authority, Subic Bay Metropolitan Authority, Authority of the Freeport Area of Bataan and Cagayan Economic Zone Authority.
Central Luzon received the biggest chunk of foreign investments at P3.66 billion from April to June. Some P2.1 billion went to Calabarzon while Davao Region got P1.12 billion.
Of the 17 regions in the country, six did not get any foreign investment: the Cordillera Administration Region, Ilocos, Mimaropa, Bicol, Zamboanga Peninsula and the Bangsamoro region.
Of the investment promotion agencies, 66 percent were made with BOI at P14.78 billion followed by PEZA with P5.02 billion.
Information and communication secured the highest share at 56 percent among industries with foreign investments worth P12.53 billion. Construction came in second with P3.62 billion.
Manufacturing ranked third with P2.27 billion in investment pledges.
There was no foreign investment poured into water supply, sewerage, and waste management, public administration and defense, financial and insurance activities, education, arts and entertainment, and other service activities.
It should be noted that the hard hit industries of arts and entertainment, even education and other service activities have yet to secure investments as restrictions remain in place in these sectors.
According to the PSA, the investment commitments were mainly driven by UK projects, which accounted for 55.6 percent of the total, followed by South Korea which comprised 10 percent, and companies from the US which had a 9.5 percent share.
Businesses from the UK committed investments totaling P12.52 billion, while those from South Korea pledged P2.25 billion. Those from the US, meanwhile, pledged a total of P2.13 billion.
The approved investments of foreign and Filipino nationals in the second quarter created 25,056 jobs, down 32 percent from the 36,572 jobs created in 2020.
Of these, 68 percent will be absorbed by projects with foreign interest with the construction sector expected to produce the most number of jobs.