ASEAN KEY DESTINATIONS
FDI more than doubled in December 2016
Foreign Direct Investments (FDI) continued to register net inflows until the last month of 2016, rising by 145.9%, data from the Bangko Sentral ng Pilipinas (BSP) showed.
The FDI is a measure of investment by foreign companies or individuals in a country and is a key source of employment and capital for the domestic economy.
In December 2016, the FDI amounted to $669 million, more than double from the $272 million recorded in the same period in 2015.
"FDI inflows remained robust, supported by strong investors’ confidence in the country’s solid macroeconomic fundamentals," the central bank said.
For his part, BSP Deputy Governor Diwa Guinigundo noted that the net FDI inflows meant the core confidence of foreign investors in the resilience of the Philippine economy remained entrenched.
"The challenge is to address what remains of the issues in the domestic front including the certainty of reform momentum on taxes, mining, good governance, among others," Guinigundo said in a text message.
Bulk of the gross equity capital placements was mainly from Hong Kong, Japan, the United States, Singapore, and Belgium. These were channeled mainly to arts, entertainment and recreation; financial and insurance; manufacturing; real estate; and professional, scientific and technical activities.
Net equity capital infusion reached $206 million, as equity capital placements of $294 million more than offset the $88 million withdrawals.
More than half or $415 million of the net inflows during the month were non-resident affiliates’ net placements in debt instruments issued by resident affiliates or intercompany borrowings.
Reinvestment of earnings stood at $47 million during the month.
For the whole 2016, net FDI inflows reached $7.9 billion, up 40.7 percent from $5.6 billion year-on-year.
"This resulted as all FDI components continued to register net inflows," the BSP noted.
Net availment of debt instruments rose by 68.6 percent to $5.2 billion from $3.1 billion in 2015. Equity capital investments posted net inflows of $2 billion, up 12.1 percent from $1.8 billion.
"This resulted as placements of $2.7 billion outweighed withdrawals of $643 million," the BSP said.
It added that for the full-year 2016, equity capital placements came mainly from Japan, Hong Kong, Singapore, the United States, and Taiwan, and was infused largely to financial and insurance; arts, entertainment and recreation; manufacturing; real estate; and construction activities.
Reinvestment of earnings declined by 4.9 percent to $710 million during the year. — MDM, GMA News
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