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Net FDI for April hits 6-month high

NET foreign direct investment (FDI) inflows posted a minimal year-on-year drop in April but was still the highest in six months, the Bangko Sentral ng Pilipinas (BSP) reported on Tuesday.

Net inflows fell by 3.2 percent to $1.027 billion from a year ago with the bulk coming from intercompany loans, central bank data showed.

April’s net FDI, however, was up from March’s $682 million and was also highest since the P1.918 billion posted in October last year.

The result brought the year-to-date tally to $3.202 billion, up 24.3 percent from the same period last year.

“FDI inflows were boosted by continued favorable investor sentiment on the back of the country’s solid macroeconomic fundamentals and growth prospects,” the Bangko Sentral said in a statement.

Non-residents’ net placements in debt instruments issued by local affiliates or intercompany borrowings amounted to $705 million, down 22.6 percent from a year ago.

Reinvestments of earnings also decreased by 7.1 percent to $75 million from a year ago.

The BSP noted a significant expansion in net equity capital inflows, which rose to $247 million as placements of $262 million more than offset the $15 million in withdrawals.

“Equity capital placements emanated largely from Singapore, Hong Kong, the Netherlands, the United States, and Japan,” it said.

Net FDI inflows for January to April, meanwhile, were driven largely by $1.8 billion in net investments in debt instruments, which was 14.5 percent lower reckoned from a year earlier.

Reinvestments of earnings were also lower at $268 million, the Bangko Sentral said.

Net investments in equity capital, on the other hand, surged to $1.134 billion from $199 million in the comparable 2017 period as gross placements of $1.258 billion more than compensated for withdrawals of $124 million.

Equity capital infusions during the period came mainly from Singapore, Hong Kong, China, Japan and the United States, and were invested in manufacturing; financial and insurance; arts, entertainment and recreation; real estate; and electricity, gas, steam and air-conditioning supply activities.

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