Japan has emerged the country’s top foreign direct investor in data compiled by the Bangko Sentral ng Pilipinas (BSP) in January this year.
The country’s neighbor accounted for a third or 69 percent of gross placements during the month when the funds, in the form of equity, reinvestments or borrowings, were poured into manufacturing, real estate, construction and real estate.
According to the BSP, the foreign direct investments in January this year almost doubled on net basis to USD907 million from only USD478 million 12 months earlier.
During the month, net investments in debt instruments expanded 173 percent to USD820 million from only USD300 million and reinvested earnings rose 16.4 percent to USD99 million from USD85 million. These are profits derived from non-resident earnings in domestic placements and plowed back into the various enterprises instead of remitted to their overseas principals.
Equity capital placements, which are invested in bricks-and-mortar enterprises that generate employment for Filipinos, pay tax to the government and stay invested for the long haul, posted a net outflow of USD11 million or a reversion from net inflow of USD93 million a year earlier.
The manufacturing sector accounted for 35 percent of the equity placements followed by real estate which accounted for 24 percent, construction with 20 percent and the retail and wholesale trade with 16 percent. Other industries had seven percent of the foreign direct investment pie for the period.
The BSP counts as FDI only equity capital placements at least 10 percent in domestic enterprises.
It does not count as foreign investment those captured by the Philippine Statistics Authority which are reported to it by government promotion agencies like the Department of Trade and Industry representing pledges rather than committed capital in domestic enterprises.
