FDI drops for the 1st time in eight months
Foreign direct investment (FDI) inflows in the Philippines dropped by 16% to $819 million in January after eight months of growth.
According to data released by the Bangko Sentral ng Pilipinas (BSP), this was the first annual decline in FDI since the 20.3% fall to $452 million in May 2021.
BSP explained that the decrease may be due to the resurgence of the Omicron COVID-19 cases and the reimposition of quarantine protocols at the start of the year.
FDIs in equity capital plunged by 70.3% to $107 million in January from $360 million a year earlier. Placements dropped by 68.2% to $118 million, while withdrawals rose by 6.8% to $11 million.
Among FDI segments, only the inflows to debt instruments increased, expanding by 18.3% to $634 million in January from $536 million a year earlier.
Asian Institute of Management economist John Paolo R. Rivera, meanwhile, said that FDIs might rebound in the next few months as COVID-19 cases continue to drop and business activity improves.
However, Rivera added that foreign investors are also closely watching the outcome of the upcoming national elections.
A Bloomberg survey of economists last month showed that Vice-President Leonor G. Robredo was the preferred bet of investors and analysts to become the next President of the Philippines.
