July foreign investments in PH reach $1.38 billion net inflows

By Francis Allan L. Angelo

The Philippines recorded a significant increase in foreign investments in July 2024, achieving net inflows of $1.38 billion, according to data from the Bangko Sentral ng Pilipinas (BSP).

The latest number marks a substantial recovery from the $27.26 million net outflows posted in June 2024 and reflects robust investor confidence in the country’s financial markets.

The total registered investments for July reached $2.43 billion, a sharp increase of 133.3% from June’s $1.04 billion. Of these investments, 71.3% were directed toward Peso-denominated government securities, amounting to $1.73 billion.

Meanwhile, 28.7% were placed in Philippine Stock Exchange (PSE)-listed securities, totaling $697.67 million. These investments were predominantly made in banks, holding firms, property, transportation services, and the food, beverage, and tobacco sectors.

The primary sources of these investments were the United Kingdom, the United States, Singapore, Luxembourg, and Norway, which collectively accounted for 93.7% of the total registered investments for the month.

On the other hand, gross outflows for July amounted to $1.05 billion, slightly lower by 1.9% compared to June 2024’s $1.07 billion. The United States remained the top destination for these outflows, receiving 45.3% of the total, or $475.35 million.

Year-on-year, July 2024’s registered investments were higher by $856.05 million, a 54.3% increase from the $1.58 billion recorded in July 2023.

Similarly, gross outflows increased by 70.6% compared to the $614.93 million recorded in the same period last year.

The net inflows for July 2024 were also notably larger than the $961.58 million net inflows seen in July 2023.

For the period from January 1 to July 31, 2024, the Philippines achieved net inflows of $1.46 billion, a dramatic 830.7% increase compared to the $157.30 million net inflows recorded in the same period in 2023.

The registration of inward foreign investments with the BSP, facilitated by authorized agent banks, is optional under the country’s foreign exchange rules. It becomes necessary only if the investor intends to purchase foreign exchange from these banks for the repatriation of capital or remittance of earnings on the registered investments.

Without registration, repatriation and remittance can still occur, but the foreign exchange must be sourced outside the banking system.