LONG-TERM investments placed by international players in the Philippines continued to soar in April this year, indicating sustained positive sentiment of foreign investors for the country’s recovery prospects.
Foreign direct investments (FDI) posted a 114.4-percent growth in April this year to hit $679 million during the month, up from the $317 million in the same month last year.
The strong April FDI performance pushed the total FDI numbers of the country to $3.06 billion in the first four months of the year, growing by 56.3 percent from the $1.96 billion in January to April in 2020.
FDI are investments made by foreign players in the Philippines in the hopes of long-term return. Since these are in the country for a longer term compared to their short-term counterpart, the foreign portfolio investments (FPI), the FDI usually create jobs for Filipinos and have a multiplier effect on the economy.
“FDI net inflows in April 2021 rose on the back of positive foreign investor sentiment on the country’s macroeconomic fundamentals and strong growth prospects,” the BSP said in a statement on Monday.
The higher FDI net inflows in April were due to the improvements in most components, led by non-residents’ net investments in debt instruments.
This subsector rose by 121.2 percent to $500 million from $226 million during the
month.
Foreign investors’ net investments in equity capital also rose to $97 million in April 2021 from $3 million in the same month last year.
This developed as equity capital placements increased by 131 percent to $108 million from $47 million, while withdrawals decreased by 75.1 percent to $11 million from $44 million.
Equity capital placements during the month originated primarily from Japan, the United States, and Singapore.
These were invested largely in the manufacturing and real estate industries.
Meanwhile, reinvestment of earnings declined by 6.2 percent to $82 million from $88 million in April 2020.