Net inflows of foreign direct investments declined 2.2 percent in February to $608 million from $621 million in the same month last year, the Bangko Sentral ng Pilipinas said Monday.
The BSP said in a statement the slight decline came from the 88.3-percent drop in non-residents’ net investments in equity capital to $20 million in February from $175 million a year ago.
Equity capital placements decreased by 62.1 percent to $89 million from $236 million while withdrawals rose 13.6 percent to $69 million from $61 million.
Equity capital placements in February came mostly from Japan, the United States, the Netherlands, Malaysia and Singapore. These were invested in manufacturing; real estate; wholesale and retail trade; financial and insurance; and electricity, gas, steam, and air-conditioning supply industries.
Meanwhile, the 36.1-percent increase in non-residents’ net investments in debt instruments to $515 million in February from $378 million in the same month last year tempered the decline in FDI.
Reinvestment of earnings rose 6.1 percent to $72 million from $68 million in February 2020.
Data showed that in the first two months, FDI net inflows increased by 20.6 percent to $1.6 billion from $1.3-billion net inflows reported in the same period in 2020.
“This was due mainly to the 67.7-percent expansion in non-residents’ net investments in debt instruments to $1.1 billion from $626 million,” the BSP said.
Non-residents’ net investments in equity capital in the two-month period were lower at $372 million from $525 million in the same period last year.
This was due to the contraction in equity capital placements to $451 million from $610 million, which more than offset the drop in withdrawals to $79 million from $85 million.
Net inflows of FDIs contracted 25 percent in 2020 to $6.5 billion from $8.7 billion in 2019, pulled down by the impact of the COVID-19 pandemic. The BSP expects FDI to post net inflows of $7.8 billion in 2021.
The BSP statistics on FDIs include investments by a non-resident direct investor in a resident enterprise, whose equity capital in the latter is at least 10 percent; and investment made by a non-resident subsidiary/associate in its resident direct investor.