GMA says investments grew by 52 percent

President Arroyo said yesterday that foreign investment in the country had increased by as much as 52 percent during the first six months of the year despite "excessive politicking."

In a televised roundtable discussion with Trade Secretary Peter Favila and Bangko Sentral ng Pilipinas Deputy Governor Diwa Gunigundo, the President said increased investments and remittances from overseas Filipino workers (OFWs) had helped generate nearly a million jobs and propped up the economy.

"I thank the investors and the officials who promote investments… These show investor confidence in the country despite too much politicking. Maybe the reason why there is still confidence is because of economic and fiscal reforms. What more if excessive politicking (were) avoided," Mrs. Arroyo said.

"Let us continue with our economic reforms and promote peace and stability so that businesses would prosper and jobs for the people would be generated," she said.

From January to June this year, the country attracted some $500,000 in foreign direct investments, reflecting a 52-percent increase in investments compared to the same period last year. The investments reportedly generated some 900,000 new jobs.

As far as portfolio investments are concerned, Mrs. Arroyo said some $2 billion have been plowed into the local stock market, 13 times more than last year.

OFW remittances, which have helped prop up the economy for decades, also increased by 22 percent this year. Reports said remittances to the Philippines rose to about $5.8 billion from January to July. This is around P1 billion more than the $4.7 billion received for the same period last year.

The President said remittances and increased exports helped cushion the effects of fluctuating foreign exchange rates and increasing prices of crude oil on the world market.

Favila said that for the first six months of the year, P105 billion worth of investments had been generated by firms registered with the Board of Investment (BOI) while P27 billion was recorded by the Philippine Economic Zone Authority.

The investments were mostly in mining, power and tourism industries, he said.

Gunigundo, for his part, said that foreign money coming into the country through debt securities had reached $1.2 billion this year.

"There are those who say that this (portfolio investment) is called hot money. But this will not necessarily become hot money if our investors have confidence in the economy," Gunigundo said.

"Even if many of these investments come in and out quickly, there are more that remain in the country," he explained. — Paolo Romero