BSP-registered foreign investments yield net inflows in June 2023

Transactions on foreign investments* registered with the Bangko Sentral ng Pilipinas (BSP), through authorized agent banks (AABs), in June 2023 recorded net inflows of US$1 million after four (4) consecutive months of net outflows as the US$889 million gross inflows for the month narrowly surpassed the gross outflows of US$888 million.

The recorded net inflows are also a reversal from the net outflows posted in May 2023 (US$124 million) and in June 2022 (US$342 million).

The US$889 million registered investments for the month are higher by US$45 million (or by 5.3 percent) compared to the US$845 million recorded in May 2023.

Majority of registered investments (US$700 million or 78.7 percent) were in PSE-listed securities [investments mainly in: (a) property; (b) banks; (c) holding firms; (d) food, beverage and tobacco; and (e) telecommunications], while the remaining were in Peso GS (US$190 million or 21.3 percent) and in other instruments [less than one (1) percent].

The top five (5) investor countries for the month were the United Kingdom (UK); United States (US); Luxembourg; Singapore; and Switzerland with combined share to total at 84.2 percent.

The US$888 million gross outflows for the month were lower by US$81 million (or by 8.4 percent) compared to gross outflows recorded for May 2023 (US$969 million).

The US received US$589 million (or 66.3 percent) of total outward remittances.

Year-on-year, registered investments in June 2023 are lower than the US$1.0 billion recorded in June 2022 by US$149 million (or by 14.4 percent), while gross outflows also dropped by US$493 million (or by 35.7 percent) vis-à-vis the gross outflows posted in June 2022 (US$1.4 billion).

The US$1 million net inflows in June 2023 is an improvement from the US$342 million net outflows recorded for the same period a year ago.

Year-to-date transactions (01 January to 30 June 2023) for foreign investments registered with the BSP, through AABs, yielded net outflows of US$803 million which is a reversal of the US$778 million net inflows noted for the same period last year (01 January to 30 June 2022).

Registration of inward foreign investments delegated to AABs by the BSP is optional under the rules on foreign exchange (FX) transactions.

It is required only if the investor or its representative will purchase FX from AABs and/or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of earnings that accrue on the registered investment.

 

Without such registration, the foreign investor can still repatriate capital and remit earnings on its investment but the FX will have to be sourced outside the banking system.

*These investments refer to the following inward foreign investments registered with AABs: PSE-listed securities; Peso-denominated government securities; Peso time deposits with banks with minimum tenor of 90 days; other Peso debt instruments; unit investment trust funds; and other instruments such as Exchange Traded Funds and Philippine Depositary Receipts.