Philippines’ Foreign Investment Pledges Soared in Q4 2023

In a remarkable surge, foreign investment pledges approved by investment promotion agencies (IPAs) skyrocketed to P394.45 billion in the fourth quarter of 2023, marking a substantial increase from P173.61 billion a year earlier. This robust growth, reported by the Philippine Statistics Authority (PSA), underscores the country’s robust economic performance.

According to Rizal Commercial Banking Corp. chief economist Michael Ricafort, this surge can be attributed to several factors, including improved economic and financial market performance, easing inflation, and favourable demographics. He highlighted that Philippine economic growth ranks among the fastest in ASEAN and Asia, alongside lower long-term interest rates, which have encouraged more foreign investments in the country.

The surge in foreign investments also reflects realised commitments made during various foreign trips of President Marcos. Notably, the IPAs that reported the latest investment figures include the Authority of the Freeport Area of Bataan, Board of Investments (BOI), Clark Development Corp., Philippine Economic Zone Authority, and Subic Bay Metropolitan Authority.

The Netherlands emerged as the top investor, contributing P345.76 billion, followed by Japan and Singapore. The electricity, gas, steam, and air conditioning supply industry received the largest share of approved investments, with Bicol, Eastern Visayas, and Ilocos Region ranking as top recipients by region.

Total approved investments from both foreign and Filipino nationals reached P585.15 billion, a 21% increase from the previous year. While these investments are expected to generate employment opportunities, Ricafort anticipates further boosts in foreign investments driven by potential interest rate cuts and recent trade agreements.

Looking ahead, initiatives like the free trade agreement with South Korea and the Regional Comprehensive Economic Partnership agreement are poised to stimulate trade, investments, and overall economic growth, further solidifying the Philippines’ position as an attractive investment destination.