Net FDI dips in August

'Sustained uncertainty surrounding the global economy' tagged

NET foreign direct investments (FDI) fell slightly in August from a year earlier, the Bangko Sentral ng Pilipinas (BSP) reported on Friday.

At $789 million, the net FDI inflow was 0.3 percent lower than the $792 million posted a year earlier.

The year-to-date total of $5.5 billion, meanwhile, was 12.9 percent lower than the $6.3 billion posted in the comparable 2022 period.

"[T]he recorded slowdown may be due largely to investor concerns following the sustained uncertainty surrounding the global economy," the BSP said in a statement.

The central bank, however, also said the continued FDI net inflows continued to «reflect the country's strong macroeconomic fundamentals.»

August's decrease was primarily due to a 7.8-percent contraction in nonresidents' net investments in debt instruments, to $537 million from $582 million in August 2022

This was partly offset by an increase in nonresidents' investments in equity capital, which grew by 13.3 percent to $36 million from $31 million, as well as a 21.4-percent increase in reinvested earnings that reached $217 million from $179 million.

Japan, the United States and Singapore accounted for the bulk of August FDI, which were mostly channeled to manufacturing (55 percent), wholesale and retail trade (15 percent), information and communication (14 percent).

For January to August, net equity capital placements declined by 13.1 percent to $844 million from $971 million a year earlier.

Reinvestments of earnings slid to $790 million, down 5.8 percent from $838 million, while net investments in debt instruments plunged by 14.2 percent to $3.8 billion from $4.4 billion.

Equity capital placements for the first eight months of 2023 originated mostly from Japan, Germany, the United States and Singapore.

More than half or 54 percent went to manufacturing, followed by real estate (15 percent), and finance and insurance (9.0 percent).