Net foreign direct investments hit $379 million in May

MANILA, Philippines – Foreign direct investments (FDIs) continued to post net inflows in May, amounting to $379 million or more than seven times higher than the year-ago level of $50 million, Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. said yesterday.

Direct investments went up as net equity capital inflows, which represent 84 percent of total FDIs amounted to $319 million in May following the purchase of Kirin Holdings, one of Japan’s largest brewers, of a 49 percent stake in local firm San Miguel Brewery during the month.

This development is a reflection of the favorable sentiment of foreign investments following early signs of stabilization in the global economy, the central bank said.

Reinvested earnings and other capital also recorded net inflows of $13 million and $47 million, respectively.

The May net inflows brought the year-to-date net FDI inflows to $1 billion, nearly twice the level recorded during the same period a year ago, data from the BSP also showed.

“Both equity capital and reinvested earnings recorded higher net inflows at $946 million and $80 million, respectively, which more than offset the contraction in the other capital account,” the BSP said.

A total of $1 billion in gross equity capital placements were made by investors from Japan and the US, benefiting the manufacturing, real estate, construction and trade sectors.

Reinvested earnings during the five-month period reversed to a net inflow of $80 million from the $207 million net outflow recorded a year ago.

The BSP said that declining inflation and rosy corporate earnings results in the first quarter encouraged investors to reinvest their earnings in local enterprises. –Iris C. Gonzales (The Philippine Star)