Foreign direct investments rose to $820M in July — BSP

Net inflows of foreign direct investments (FDI) to the Philippines saw a recovery in July amid improved investor sentiment during the period, data released by the Bangko Sentral ng Pilipinas (BSP) showed Thursday.

Preliminary central bank data showed FDI net inflows stood at $820 million, up 5.5% from $778 million net inflows seen in the same month last year.

FDI net inflows in July also improved from the $394-million net inflows recorded in June, which was the lowest FDI net inflows since April 2020.

“The improvement in FDI was driven by higher net inflows across all components,” the BSP said.

The BSP noted that foreigners’ net investments in debt instruments rose by 2.7% year-on-year to $610 million from $594 million.

Non-residents’ reinvestment of earnings and their net investments in equity capital increased by 12.8% to $135 million from $120 million and 16.8% to $76 million from $65 million, respectively.

The BSP said the bulk of the equity capital placements in July 2024 came from Japan, the United States, and Singapore.

“These investments were channeled mainly to the  manufacturing and real estate industries,” it said.

The July FDI net inflows brought the January to July 2024 figure to $5.3 billion, up 7.5% from $4.9 billion net inflows in the same period last year.

The central bank defines FDI as an investment by a foreign direct investor in a local enterprise, whose equity capital in the latter is at least 10% or an investment made by a foreign subsidiary in its resident direct investor.

FDI can be in the form of equity capital, reinvestment of earnings, and borrowings.

The BSP's FDI statistics are distinct from the investment data of other government sources as this covers actual investment inflows, as compared with approved foreign investments data published by the Philippine Statistics Authority (PSA) sourced from Investment Promotion Agencies representing investment commitments or pledges which may not necessarily be realized fully, in a given period. — RSJ, GMA Integrated News