Foreign Investments registered with BSP yield net outflows in September 2023

Transactions on foreign investments registered with the Bangko Sentral ng Pilipinas (BSP), through Authorized Agent Banks (AABs)*,  in September 2023 recorded net outflows of US$698 million resulting from the US$1.6 billion gross outflows and the gross inflows of US$888 million for the month.

The recorded net outflows were a reversal of the net inflows posted in August 2023 amounting to US$153 million.

The US$888 million registered investments for the month are lower by US$553 million (or by 38.4 percent) compared to the US$1.4 billion recorded in
August 2023.

During the month, 52.1 percent of registered investments were in PSE-listed securities (US$462 million) [most of which were investments made in:
(a) banks; (b) holding firms; (c) property; (d) food, beverage and tobacco; and (e) utilities companies], while the remaining were in Peso government securities (US$425 million or 47.9 percent).

Investments for the month mostly came from the United Kingdom, Singapore, United States (US), Luxembourg and Switzerland with combined share to total at 88.5 percent.

The US$1.6 billion gross outflows for the month were higher by US$298 million (or by 23.2 percent) compared to the gross outflows recorded for August 2023 (US$1.3 billion).

The US remains to be the top destination of outflows, receiving US$1.0 billion (or 63.6 percent) of total outward remittances.

Year-on-year, registered investments in September 2023 are lower than the US$892 million recorded in September 2022 (by US$4 million or 0.5 percent), while gross outflows increased by US$326 million (or by 25.9 percent) vis-à-vis the gross outflows posted in September 2022 (US$1.3 billion).

The US$698 million net outflows in September 2023 were also larger than the US$367 million net outflows recorded for the same period a year ago.

Year-to-date transactions (01 January to 30 September 2023) for foreign investments registered with the BSP, through AABs, yielded net outflows of US$387 million which were a reversal compared to the US$222 million net inflows noted for the same period last year (01 January to 30 September 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.

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*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.