towards Katherine K. Chan
The net rise of foreign diinvestment (FDI) in Philippines down 40.5% In August, amid a decline in the total amount of debt instruments, the Bangko Sentral NG Pipipinas (BSP) reported on Monday.
High-level banking data showed that net income was reduced by 40.5% year-on-year to $ 494 million from $ 830 million in the same month in 2024.
This was the lowest amount in two months or since the $376 million recorded in June.
Month-to-month, FDIS increased by 61% from $1.268 billion in July.
“Philippines’ foreign direct investment remains positive in August 2025, with inflows from Japan and manufacturing leading,” BSP said a statement on Monday.
Investments in debt instruments increased by 73.8% to $145 million in August from $553 million last year.
This consisted mainly of Intercompany borrowing or lending between foreign investors and their sponsors orefLitetes in the Philippines, according to the central bank.
Meanwhile, investments in Equity and Investment Fund shares rose 26.1% to $349 million in August from $276 million in the same period.
The non-standard investment of NONTERSESTS EMPITTITIT, without the renewal of income, is more than returned to $ 146 million from $66 million a year ago.
Equity inflows increased by 53.2% to $158 million from $103 million last year, while withdrawals decreased by 66.2% to $13 million from $37 million a year earlier.
Retained earnings were revised up 3.6% to $203 million in August from $210 million a year ago.
Union Bank of the Philippines (Unionbank) Ruben Carlo O. Asuncion said in a Viber message the Lower FDI Offlows reflects the influence of foreign articles and sentiments of domestic investors.
“The sharp decline in non-metallic bullish call investment … was the main drag, suggesting more contraction and financing activity amid global conditions,” he added.
Mr. Asuncion said the main factors that contributed to the decline in August include global trade, high US prices, geopolitical uncertainty, and global financial conditions.
Meanwhile, Rizal Commerce Banking Corp. Economist Michael L. Ricafut says US taxes and other protectionist policies and the flood control debate may be weighing on investors’ fingers.
“The series of storms from July (to) August could have also been weighed down by many domestic economic data, including business days that were affected by these weather-related disruptions in the local economy,” he added in a Viber message.
Eight months of FDI down
In the first eight months of the year, the emergence of FDI Net Offlows decreased by 22.5% to $ 5.179 billion from $ 6.686 billion in the same period in 2024.
This comes as investment in equity shares fell by 18.7% to $1.786 billion from $2.195 billion a year earlier.
Net foreign investment in Equity Capital without the renewal of funds received likewise decreased by 35.5% to 870 million from $ 1.349 billion last year.
Placements decreased by 20.1% to $1.364 billion, while withdrawals increased by 37.6% to $494 million.
Investments that do not include non-indicative cattle metals by 24.4% to $ 3.393 billion in the eight-month period from $ 4.49 billion in the previous year.
“In the first eight months of 2025, equity capital inflows were mainly received from Japan, the United States, Singapore and South Korea,” the Central Bank said.
Most of the foreign investment went to manufacturing, more trading and retailing, and real estate, it added.
“In time, while the balance placement from Japan, the US, South Korea remains good – especially in making the production area, sales, sales related to goods related to policy clarification, food bottles,” said Mr. Ascension.
He said the FDI Net inflow is likely to pick up in the last quarter of the year.
“While this is below trend, we believe the full BSP target is $7.5 “The recent UPTICK in equity placement and renewable earnings in July and August is encouraging, and we expect some recovery (fourth quarter) as financial exposure stabilizes.”
Mr. Ricafort also noted that the reduction of the central bank would help attract more FDIS to the country.
“More rate cuts by the Fed and the BSP in the coming months will also make borrowing costs cheaper for foreign investors, in both currencies Expansion projects,” he said.
Since it started its cycle in August last year, the Central Bank lowered the benchmark policy rate
BSP Governor Eli M. Remolona, Jr. Earlier he said that they can bring another cut later this year and they became 2026 the final stop of the average car this year in Decen 11.
