Foreign direct investments into the Philippines continued to slip in the first quarter of this year after last year’s record surge in long-term equity inflows, the latest data from the Bangko Sentral ng Pilipinas showed.

The central bank said cumulative net inflows of foreign direct investments reached $1.9 billion from January to March this year, or a decline of 15.1 per cent from the $2.3 billion in net inflows in the same period last year.

“This resulted from the lower net inflows of net equity capital, which amounted to $295 million from $887 million last year,” the central bank said.

In particular, equity capital placements declined to $568 million from $996 million, while withdrawals increased to $273 million from $109 million.

The total equity flows into the country during the first three months of the year, excluding companies’ reinvested earnings, declined by 67 per cent, which included a 150 per cent surge in capital repatriation, according to the central bank data.

Equity capital infusions during the period came mainly from Japan, China, the US, Singapore and South Korea.

These were channelled largely to the financial and insurance; real estate; transportation and storage; manufacturing, and administrative and support service industries.

On the other hand, net investments in debt instruments increased by 18.6 per cent to $1.4 billion from $1.2 billion in the same quarter last year. Reinvestment of earnings increased by 11.3 per cent to $234 million during the quarter from $211 million in the comparable period last year.

For the month of March alone, foreign direct investments posted $586 million in net inflows, which was lower by 13.9 per cent than the $681 million in net inflows in the comparable period last year.

This developed on account of the decline in net equity capital investments as placements dropped to $126 million from $351 million in March last year.

Equity capital placements during the month came mostly from Japan, the US, Singapore and the Netherlands. These were largely invested in the manufacturing; real estate; accommodation and food service; wholesale and retail trade, and arts, entertainment and recreation industries.

Meanwhile, non-residents’ investments in debt instruments – consisting mainly of loans extended by parent companies abroad to their local affiliates – recorded an increase of 35.8 per cent to $399 million from $294 million last year.

Reinvestment of earnings increased by 14.4 per cent to $80 million during the period from $70 million a year ago. PHILIPPINE DAILY INQUIRER/ASIA NEWS NETWORK