FDI net inflows down 36.2% in September

Foreign direct investment (FDI) net inflows posted a double-digit decline in September to mark its weakest showing in years due to the lower inflows to debt instruments during the period, data released by the Bangko Sentral ng Pilipinas (BSP) on Tuesday showed.

The September FDI — a key source of jobs and capital for the local economy — posted a $368-million net inflow in September, reflecting a 36.2% decline from the $577-million net inflows posted in September 2023.

This also compares with the $815-million net inflows in August, and is the lowest in at least three years based on the data available dating back to January 2022.

“The downturn in FDI net inflows in September 2024 was due largely to the 32.8% decline in nonresidents’ net investments in debt instruments to $277 million from $413 million,” the central bank said in a statement.

Nonresidents’ net investments in equity capital likewise fell by 91.2% to $7 million, but was slightly offset by the 3.6% increase in nonresidents’ reinvestment of earnings to $84 million from $81 million.

Bulk of the equity capital placements for the month came from Japan, the United States, and Singapore, which were there channeled mainly into manufacturing, real estate, information and communication, and wholesale and retail trade industries.

The year-to-date FDI net inflow stood at $6.7 billion, up by 3.8% from $6.4 billion recorded in the comparable period of 2023.

The United Kingdom was the biggest source of inflows for the period, accounting for 43%. This was followed by Japan with 37%, the United States with 9%, and Singapore with 4%.

Most of the investments were channeled into manufacturing which had a 74% share, followed by real estate with 11%, wholesale and retail trade with 4%, and others with 10%. — RSJ, GMA Integrated News