PH Foreign Investments Experience Net Outflows in April 2023

Foreign investments registered with the Bangko Sentral ng Pilipinas (BSP) through Authorized Agent Banks (AABs) recorded net outflows of US$352 million in April 2023.

This comes as a result of gross outflows amounting to USD1.1 billion, which surpasses the gross inflows of USD713 million.

The recorded outflows mark a significant increase compared to March 2023, when net outflows amounted to USD70 million, and a complete reversal from April 2022 when the country experienced net inflows of USD1.4 billion.

Moreover, the registered investments for the month reached USD713 million, reflecting a decrease of 43.2 percent, or USD543 million, compared to the previous month’s figure of USD1.3 billion.

57.3 percent of these investments were made in Philippine Stock Exchange (PSE)-listed securities, particularly in banks, holding firms, property, food, beverage and tobacco, and transportation services.

Meanwhile, 42.7 percent of the investments were in peso government securities, with the remaining portion in other instruments.

Among the top investor countries during this period were the United Kingdom, United States (US), Singapore, Luxembourg, and Norway, collectively accounting for 84.1 percent of the total investments.

Gross outflows for April 2023 amounted to USD1.1 billion, down by 19.7 percent, or USD261 million, compared to March 2023.

The majority of outward remittances, 70.9 percent, were received by the US.

Year-on-year data shows that the registered investments in April 2023 declined significantly by 68.0 percent, or USD1.5 billion, compared to April 2022. However, gross outflows increased by 29.3 percent, or USD241 million, compared to the same period last year.

Year-to-date transactions from January to April 2023 resulted in net outflows of USD680 million, in contrast to the net inflows of USD1.4 billion recorded during the same period in 2022.

Foreign investments registered with the BSP through AABs are subject to optional registration under the foreign exchange (FX) transaction rules. Registration is required if the investor or its representative intends to purchase FX from AABs for the repatriation of capital and remittance of earnings.

However, without registration, investors can still repatriate capital and remit earnings, sourcing FX from outside the banking system. (GFB)