Transactions on foreign investments registered with the BSP, through AABs, in December 2023 recorded net outflows of US$205 million resulting from the US$1.3 billion gross outflows and the US$1.1 billion gross inflows for the month.  The recorded net outflows are a reversal of the US$673 million net inflows posted in November 2023.

The US$1.1 billion registered investments for the month are lower by US$509 million (or by 32.3 percent) compared to the US$1.6 billion recorded in November 2023. During the month, 52.9 percent of registered investments were in PSE-listed securities (US$564 million) [most of which were investments made in: (a) banks; (b) holding firms; (c) property; (d) transportation services; and (e) food, beverage and tobacco], while 47.1 percent where in Peso government securities and the remaining [less than one (1) percent] were in other instruments.  Investments for the month mostly came from the United Kingdom (UK), Singapore, United States (US), Luxembourg, and Hongkong with combined share to total at 83.3 percent.

The US$1.3 billion gross outflows for the month were larger by US$369 million (or by 40.9 percent) compared to the gross outflows recorded for November 2023 (US$902 million). The US remains to be the top destination of outflows, receiving US$677 million (or 53.3 percent) of total outward remittances.

On a year-on-year basis, registered investments in December 2023 are lower by US$26 million (or by 2.4 percent) than the US$1.1 billion recorded in December 2022. Similarly, gross outflows increased by US$272 million (or by 27.2 percent) vis-à-vis the gross outflows posted in December 2022 (US$999 million). The US$205 million net outflows in December 2023 were a reversal from the US$93 million net inflows recorded for the same period a year ago.

For the whole year of 2023, foreign investments registered with the BSP, through AABs, aggregated US$12.9 billion, reflecting a 4.4 percent increase (or by US$542 million) compared to the US$12.3 billion level in 2022. These investments were predominantly investments in PSE-listed securities (57.3 percent) mostly in (a) banks; (b) property; (c) holding firms; (d) food, beverage & tobacco; and (e) transportation services, while the balance was invested in Peso GS (42.7 percent) and other investments (less than 1.0 percent). The UK, US, Singapore, Luxembourg, and Japan were the top five (5) investor countries during the year, with combined share to total at 83.5 percent.

Recorded outflows (US$13.1 billion) for 2023 were larger compared to previous year’s US$11.5 billion (by 14.6 percent or US$1.7 billion). Majority (or 95.1 percent) of these outflows represented capital repatriation while the remaining 4.9 percent pertained to remittance of earnings. The US continued to be the main destination of outflows with 63.6 percent of total.

Transactions on foreign investments registered with the BSP, through AABs, from 01 January to 31 December 2023 yielded net outflows of US$247 million, a reversal from the US$887 million net inflows noted for the same period last year (01 January to 31 December 2022). On a per instrument level, transactions in PSE-listed shares resulted in net outflows of US$1.0 billion which is a reversal from the US$179 million net inflows last year, while those for Peso GS recorded net inflows of US$781 million, higher compared to last year’s US$694 million net inflows.

Registration of inward foreign investments through AABs 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.

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*These investments refer to the following inward foreign investments registered with AABs: PSE-listed securities; Peso-denominated government securities; Peso time deposits with banks with minimum tenor of 90 days; other Peso debt instruments; unit investment trust funds; and other instruments such as Exchange Traded Funds and Philippine Depositary Receipts.