Foreign investments registered with BSP yield net outflows in April 2023

Transactions on foreign investments registered with the BSP, through AABs, in April 2023 recorded net outflows of US$352 million, resulting from gross outflows of US$1.1 billion and gross inflows of US$713 million.

This is higher compared to the net outflows recorded in March 2023 (US$70 million) and a reversal compared to the net inflows recorded in April 2022 (US$1.4 billion)

The US$713 million registered investments for the month are lower by 43.2 percent (or by US$543 million) compared to the US$1.3 billion recorded in March 2023.

Majority of registered investments (or 57.3 percent) were in PSE-listed securities (investments mainly in banks, holding firms, property, food, beverage and tobacco and transportation services), while the remaining were in Peso government securities (42.7 percent) and in other instruments [less than one (1) percent].

The top five (5) investor countries for the month were the United Kingdom, United States (US), Singapore, Luxembourg and Norway with combined share to total at 84.1 percent.

The US$1.1 billion gross outflows for the month are lower by 19.7 percent (or by US$261 million) compared to those recorded in March 2023 (US$1.3 billion). The US received 70.9 percent of total outward remittances.

Year-on-year, registered investments in April 2023 are lower than the US$2.2 billion recorded in April 2022 (by 68.0 percent or by US$1.5 billion), while gross outflows are higher by 29.3 percent (or by US$241 million) vis-à-vis the gross outflows recorded for April 2022 (US$823 million).  The US$352 million net outflows in April 2023 are a reversal of the US$1.4 billion net inflows recorded for the same period a year ago.

Year-to-date transactions (01 January to 30 April 2023) for foreign investments registered with the BSP, through AABs, yielded net outflows of US$680 million which is a reversal of the US$1.4 billion net inflows noted for the same period last year (01 January to 30 April 2022).

Registration of inward foreign investments delegated to AABs by the BSP is optional under the rules on foreign exchange (FX) transactions.

It is required only if the investor or its representative will purchase FX from AABs and/or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of earnings that accrue on the registered investment.

Without such registration, the foreign investor can still repatriate capital and remit earnings on its investment but the FX will have to be sourced outside the banking system.