Foreign investment post net inflows in October
Investments

Foreign investment post net inflows in October

Nov 24, 2022, 8:37 AM
Dhana Garcia

Dhana Garcia

Writer

Foreign investments yield net inflows through authorized agent banks in October 2022.

Foreign investment transactions registered with the Bangko Sentral ng Pilipinas (BSP) through the Authorized Agent Banks (AABs) recorded net inflows of $83 million in October 2022, reversing the $367 million net outflows recorded the previous month.

This came about as a result of the month's gross inflows and outflows of $645 million and $561 million, respectively.

The registered investments in October 2022 reflected a decrease of 27.7 percent or $247 million compared to the $892 million registered September 2022.

Of the investments, 73 percent were registered in the Philippine Stock Exchange (PSE) -listed securities such as: property; banks; holding firms; food, beverage, and tobacco and telecommunication.

The remaining 27 percent went to investments in peso government securities and other instruments, at less than 1 percent.

Investments for the month mostly came from the United Kingdom (UK), United States (US), Singapore, Luxembourg, and Hong Kong with combined share to total at 84.4 percent.

The $561 million gross outflows for the month were lower by 55.4 percent or $698 million than the $1.3 billion recorded in September 2022. The US received 67.7 percent of total outward remittances.

Year-on-year, registered investments fell by 32.1 percent or$305 million in October 2022 from the $950 million recorded in October 2021 to $305 million, and gross outflows fell by 52.1 percent or $610 million from the $1.2 billion reported for the same period the year before.

The $221 million net outflows in October 2021were reversed in October 2022 by the $83 million net inflows.

In contrast to the $680 million in net outflows recorded for the same period last year, transactions for foreign investments registered with the BSP through AABs so far this year have produced net inflows of $305 million.

The rules on foreign exchange (FX) transactions make registration of inward foreign investments delegated to AABs by the BSP optional.

It is only necessary if the investor or its representative plans to buy FX from AABs and/or their subsidiary or affiliate foreign exchange firms in order to repatriate capital and remit gains from the registered investment.

The foreign investor can still return funds and remit investment earnings without being registered, but FX will need to be obtained outside of the banking system.

Tags: #ForeignInvestments, #AAB, #BSP, #Inflows, #Outflows


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