BANGKO Sentral ng Pillipinas Deputy Governor Diwa Guinigundo is optimistic foreign direct investments in 2016 will register good numbers despite the negative sentiment expected in the last two months of the year.
“November and December is just like (the month of) July, it’s a dead month. People simply coast along because it is the end of the year, people don’t want to take a very decisive, very significant change or shift in their portfolio investment decisions,” Guinigundo said in an interview.
“But you have to look at year to date, it’s still a substantial flow in foreign direct investments. There was some drop (in monthly data) because of negative market sentiment, and this is something that we expect,” he said.
Latest data showed net inflows of foreign direct investments in the first 10 months of 2016 increased 22 percent to $6.2 billion from $5.1 billion a year ago on sustained investor confidence on the country’s strong macroeconomic fundamentals.
Data showed the year-to-date figure inched closer to the recently-revised net inflow target of $6.7 billion for 2016.
“Investment inflows continued amid investors’ confidence in the resilience of the economy, backed by sound macroeconomic fundamentals,” Bangko Sentral said in a statement.
Nearly two-thirds of net inflows were in the form of availments of debt instruments by local affiliates, which increased 35 percent to $3.9 billion from $2.9 billion a year ago. Net equity capital grew 9.3 percent to $1.7 billion.
The bulk of gross equity capital placements came mainly from Japan, Singapore, the United States, Hong Kong and Taiwan. These were channelled to real estate, manufacturing, wholesale and retail trade, electricity, gas, steam and air-conditioning supply, and human health and social work activities.
Net inflows in October yielded $342 million but lower than $399 million a year ago. The October figure was also lower than the net inflow of $469 million in September. President Rodrigo Duterte announced his independent foreign policy in October which, experts said, might cause investors to shy away from the Philippines.
