NET INFLOWS of foreign direct investments (FDI) into the Philippines slumped by 40.5% in August, amid a drop in net investments in debt instruments, the Bangko Sentral ng Pilipinas (BSP) reported on Monday.
Preliminary central bank data showed that net inflows declined by 40.5% year on year to $494 million in August from $830 million in the same month in 2024.
This was the lowest amount in two months or since the $376 million recorded in June.
Month on month, FDIs plunged by 61% from the $1.268 billion seen in July.
“Net foreign direct investments into the Philippines remained positive in August 2025, with inflows from Japan and into manufacturing taking the lead,” the BSP said in a statement on Monday.
Net investments in debt instruments slumped by 73.8% to $145 million in August from $553 million in the same month a year ago.
These consisted mainly of intercompany borrowing or lending between foreign direct investors and their subsidiaries or affiliates in the Philippines, according to the central bank.
Meanwhile, investments in equity and investment fund shares rose by 26.1% to $349 million in August from $276 million in the same month last year.
Nonresidents’ net investments in equity capital, excluding reinvestment of earnings, more than doubled to $146 million in August from $66 million last year.
Equity placements grew by 53.2% to $158 million in August from $103 million a year ago, while withdrawals declined by 66.2% to $13 million in August from $37 million last year.
Reinvestment of earnings also slipped by 3.6% to $203 million in August from $210 million a year ago.
EIGHT-MONTH FDI DOWN
In the first eight months of the year, FDI net inflows declined by 22.5% to $5.179 billion from $6.686 billion in the same period in 2024.
This came as investments in equity and investment fund shares fell by 18.7% to $1.786 billion during the period from $2.195 billion a year earlier.
Net foreign investments in equity capital other than the reinvestment of earnings likewise dropped by 35.5% to $870 million from $1.349 billion a year ago.
Placements went down 20.1% to $1.364 billion, while withdrawals climbed by 37.6% to $494 million.
Nonresidents’ net investments in debt instruments declined by 24.4% to $3.393 billion in the eight-month period from $4.49 billion the previous year.
“For the first eight months of 2025, equity capital placements were sourced primarily from Japan, United States, Singapore, and South Korea,” the central bank said.
Most foreign investments went into manufacturing, wholesale and retail trade, and real estate, it added.
The BSP expects FDI to end the year at a net inflow of $7.5 billion. — Katherine K. Chan