RCBC chief economist Michael Ricafort
MANILA – An economist forecasts further growth of net foreign direct investments (FDIs) into the Philippines in the coming months partly due to increased state spending on infrastructure.
The Bangko Sentral ng Pilipinas (BSP) on Monday reported that net FDIs rose by 52 percent year-on-year to USD1.3 billion last July. End-July 2021 level grew by 43.1 percent year-on-year to USD3.9 billion.
Aside from higher government infrastructure spending, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said keeping of the Bangko Sentral ng Pilipinas (BSP) of its accommodative policy stance and the passage of reform measures, such as the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law the Financial Institutions Strategic Transfer (FIST) law, among others, are pluses that are expected to attract foreign investments.
Ricafort said the reopening of the domestic economy also boosts the FDIs.
However, he said this “may be a function of better controlling/managing new Covid-19 (coronavirus disease 2019) local cases in view of the recent lockdowns in NCR (National Capital Region) to partly address this, as well as the expected increase Covid-19 vaccine arrivals and rollouts locally in the coming weeks/months.”
“Proposed more localized/granular lockdowns (shifting away from lockdowns at the city/provincial/regional levels), as well as any additional measures to reopen the economy, could allow higher capacity for some businesses/industries, thereby fundamentally supporting a more conducive environment for more FDI inflows into the country,” he added.
Monetary authorities’ net FDI outlook for this year is USD7 billion. (PNA)
