English | 中文版 |  Русский

Breaking News:

Source: www.asiaecon.org |

INVESTMENT MONEY LEAVES PHILIPPINES IN FEBRUARY


The Bangko Sentral ng Pilipinas (BSP), the Philippine central bank, recently reported that the country experienced a net outflow of foreign investment in February, reflecting more caution among global investors as the global economic downturn continues to unravel.


 

The Bangko Sentral ng Pilipinas (BSP), the Philippine central bank, recently reported that the country experienced a  net outflow of foreign investment  in February, reflecting more caution among global investors as the global economic downturn continues to unravel.

 

Registered foreign portfolio investments recorded a net outflow of $198.7 million in February, a complete reversal of the $221.4-million net inflow in January. The net outflow in February brings a total net inflow of $22.6 million so far this year, down by 79 percent from the $105.9-million net inflow in the same period in 2008.

 

On a gross basis, registered foreign portfolio investments in February 2009 totaled $196.9 million. 84 percent of total gross inflows consisted of placements in listed shares, totaling $164.5 million. 16 percent or $31.6 million consisted of inflows into government securities. Peso bank deposits amounted to less than $1 million, accounting for less than 1 percent of inflows.

 

All the inflows were outweighed by the outflows that amounted to $395.6 million in February 2009. 21 percent of total outflows, or $84.4 million, came from withdrawals of investments in listed shares. 2 percent or $6.3 million of the total outflows consisted of those in government securities and peso bank deposits.

 

Gross investment inflows totaled $698.9 million during the first two months of 2009, a 70 percent fall from over $2.3 billion gross inflow posted in the same period last year. Investments in Philippine-listed shares amounted to $485.6 million, a 60 percent decline from the $1.2 billion recorded last year. Investments in peso-denominated government securities totaled $212.6 million, a 74 percent contraction from the 2008 level of $808.1 million.

 

Investors appear to be cautious about the expected impact of the U.S. stimulus package and whether it is sufficient to prevent a global economic depression. “Some reservations on the effectiveness of the U.S. economic stimulus package and concerns over the continued weakening of major economies have increased risk aversion among investors,” BSP Governor Amando M. Tetangco Jr. said. “This caused a decline in inflows to emerging markets including the Philippines.”

 

Economic downturns in the country’s top investor countries also affected the decline of net investment flows to the Philippines. The United Kingdom, Singapore, the Netherlands and the United States were the Philippines’ top investor countries during the two-month period, collectively contributing over 83 percent of total investment funds.

 

“Hot money” has been leaving the Philippines in recent months as investors continue to be concerned about the health of their respective domestic economies as well as the global economy, prompting them to seek investments that are safer than those offered in developing countries such as the Philippines.

 

Source: www.AsiaEcon.org

Please send comments and constructive suggestions to feedback@AsiaEcon.org

 

 

 

Source: www.asiaecon.org |


More Special Articles - Asia Business & Economy Articles