FDI inflows down 20.6 pct in July

MANILA, Philippines (Xinhua) - Foreign direct investment inflows in the Philippines declined by 20.6 percent on year to $436 million in July, the local central bank said today.

Data released by the Philippine central bank showed that investments in debt instruments fell by 43.7 percent on year to $274 million during the period. This reflects lower lending of parent companies abroad to local affiliates to fund existing operations and business expansion plans in the country.

Net equity capital inflows, however, surged to $104 million in July, from $10 million posted in the same month last year. This is due to the 87.8 percent year on year hike in equity capital placements and the 69.9 percent decline in equity capital withdrawals.

The bulk of FDIs during the month came from the United States, Sweden, the Netherlands, China's Taiwan and Switzerland.

Investments were channeled mainly to financial and insurance; real estate; wholesale and retail trade; transportation and storage; and agriculture, forestry, and fishing activities.

In the seven months to July, net FDI inflows summed up to $4 billion, 56.1 percent higher than the $2.56 billion posted in the same period last year.

Last year, net FDI inflows rose by 20 percent on year to $3.86 billion, surpassing the local central bank's assumption of $2.1 billion for 2013. This year, FDI inflows are projected to reach $1 billion.