ASEAN KEY DESTINATIONS
Philippines see 56% drop in FDIs in first 8 months
Foreign direct investments in the Philippines plunged 56.3 percent from a year earlier to $1.1 billion in the eight months to August, amid the global financial crisis, a local daily quoted the central bank as saying Monday.
The January to August total was significantly lower than the year-earlier level of $2.49 billion, “partly reflecting the more challenging global financial environment,” the Manila Times reported, quoting the bank’s statement.
But for August, net foreign direct investment inflows rose 58 percent to $128 million compared to the same month last year, the central bank said, adding that the inflow reached $147 million in July.
The equity capital reached $73 million in August this year, more than twice the level in August last year, largely because of foreign-capital infusion from the privatisation of a hydropower plant.
Gross capital placements amoun¬ted to $997 million, mainly from the US, Japan, Singapore, South Korea, Germany and Malaysia.
These inflows were channeled to manufacturing, specifically shipbuilding, repair, auto electronics parts and components, paper products, cigarette products—as well as to services, mining, construction, real estate and financial institutions.
Reinvested earnings climbed to $309 million, up by 40 percent compared with last year, as some foreign investors opted to retain part of their profits in local firms.
Last year, foreign direct investment inflows were boosted by two large-scale investments in a local beverage company and a holding company in the power sector.
The central bank recently downgraded its foreign direct investment forecast this year to $2.6 billion, which is lower than earlier prediction of $4.2 billion for 2008, because of the postponement of some mining investments brought about by environmental concerns and higher prices.