FOREIGN direct investments (FDI) registered net inflows of US$311 million in April 2020, a decline of 67.9 percent from the $971 million net inflows posted in the same month last year.
The slowdown in FDI inflows reflected the continued weak global and domestic demand prospects prompting many investors to put on hold investment plans amid the unresolved Covid-19 pandemic.
The drop in FDI net inflows in April 2020 resulted from lower net investments in debt instruments, which declined by 73.2 percent to $223 million, and in equity capital, which decreased by 82.6 percent to $7 million.
In particular, equity capital placements declined by 68.3 percent to $47 million from $147 million. The bulk of the equity capital placements were sourced from Japan, the United States, Singapore and Germany. These investments were channeled mostly to manufacturing, wholesale and retail trade and real estate industries.
Likewise, reinvestment of earnings decreased by 15.8 percent to $81 million from $96 million in the same period last year.
January to April
As a result of these developments, FDI net inflows during the first four months of the year reached $2 billion, lower by 32.1 percent than the $2.9 billion net inflows recorded in the same period last year. This was due largely to the 53 percent decline in net investments in debt instruments to $1.1 billion from $2.2 billion.
In addition, reinvestment of earnings contracted by 21.7 percent to $269 million during the review period from $343 million a year ago.
The reduction in FDI from January to April 2020 was tempered by the 95.2 percent increase in net investments in equity capital to $661 million from $338 million.
Equity capital placements emanated largely from the Netherlands, Japan and Singapore during the period.
These were invested mainly to manufacturing, real estate and administrative and support service industries. (PR)