PHL’s 2013 FDI Rose 20%, Target Exceeds $1.8 Billion – BSP

The Bangko Sentral ng Pilipinas (BSP) said Monday the Philippines ended the year 2013 with a 20-percent increase in its foreign direct investments (FDI) thus exceeding the government’s assumption by about $1.8 billion.

According to the central bank, the net FDI of the Philippines increased to $3.9 billion in 2013, higher than the $3.2 billion in 2012.

The Central bank added the figure was also higher than the government’s initial expectation of $2.1 billion for last year.

In a statement, the central bank stated “The 20-percent increase in FDI during the year was buoyed by investors’ confidence on the country’s sound macroeconomic fundamentals.”

DBCC Projection

Last year, the Development Budget Coordination Committee’s (DBCC) projected an FDI of $2.2 billion would enter the country but was revised later on slightly lower to $2.1 billion because of the expected effects of the US Federal Reserve’s decision to cut down its stimulus program due to its improving economy.

Report said although the total FDI for the year were not entirely pulled down by the negative sentiment on emerging markets after the US Federal Reserve’s tapering on its quantitative-easing program, December 2013’s net FDI decelerated compared to the previous month and to December in the previous year.

December 2013’s Net FDI

December 2013’s net FDI inflows reached $180 million, lower than the $221 million in the same period last year. It also fell below the $284 million net FDI seen in the previous month, report said.

Reports added foreign investor’s placements in debt instruments rose by more than six times to hit $2.5 billion in 2013, accounting for more than half of the year’s FDI.

Placements on Equity

The BSP said “This developed as parent companies abroad continued to lend to their local affiliates to fund existing operations and expansion of their businesses in the country.”

Placements on equity in 2013 amounted to $664 million, lower than the $2 billion in the same period last year. These equity placements originated from Mexico, Japan, the United States, British Virgin Islands and Singapore, report said, adding that these were channeled to manufacturing, water supply, sewerage, waste management and remediation, financial and insurance, mining, real estate and quarrying.

Source: Business Mirror

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