The Bangko Sentral ng Pilipinas reported on Monday that some $460 million worth of foreign direct investments came into the country in July 2022, bringing the cumulative net worth of FDI inflows to $5.1 billion in the first seven month of the year.
In a statement, the BSP said these levels were lower than comparable net inflows posted during a similar period a year-ago ($1.3 billion and $5.8 billion, respectively).
“All major FDI components yielded lower net inflows in January to July 2022 as foreign investors remained cautious amid continued adverse global conditions,” the BSP said.
Data shows that FDI net inflows in July this year decreased due largely to lower non-residents’ net investments in debt instruments of their local affiliates. This decrease more than offset the growth in their net investments in equity capital.
Equity capital infusions during the month originated mainly from Singapore, Japan and the United States. These were invested largely in the construction, manufacturing, and real estate industries, the BSP added.
FDI lowest in 14 months
For his part, chief economist Michael Ricafort of Rizal Commercial Banking Corp. said “net FDI was the lowest in 14 months, or since May 2021 amid the increase in global and local market volatility in June-July 2022 when the markets experienced large sell-offs in June 2022 with some upward correction in July 2022.”
“US inflation posted a 40-year high of 9.1 percent in June 2022 and 8.5 percent in July 2022 prompting jumbo Fed rate hikes, more aggressive than rate hikes in June 2022,” Ricafort added.