MANILA, Philippines - Foreign direct investments for the first 5 months of 2010 fell 68% from a year ago as lingering concerns over the euro zone debt crisis forced investors to stay on the sidelines.
In a statement, the Bangko Sentral ng Pilipinas (BSP) reported that FDIs in January to May recorded a net inflow of $446 million, lower than last year's $1.4 billion.
Even the peaceful conduct of the May 2010 elections failed to prop up investor sentiment, with FDIs for that month alone posting a net outflow of $35 million.
FDIs are what the country should attract as they boost economic activity and create more jobs. Unlike portfolio investments in stocks and bonds, which can fly out of the country at any moment, FDIs are likely for the long term.
The BSP said FDI inflows in the first 5 months were largely loans extended by multinational companies to their local affiliates.
Equity capital, meanwhile, totaled $46 million during the period, considerably lower than last year's $1.5 billion.
The Philippines' top investors came mostly from the US, Switzerland, Japan, Netherlands, Singapore and Hong Kong.
FDIs are expected to hit $2 billion for the whole year.