Philippines Outperforms Malaysia and Thailand in Net FDI Inflows in First Three Quarters of 2023

MANILA: The Philippines has achieved a significant milestone by surpassing Malaysia and Thailand in net foreign direct investment (FDI) inflows for the first three quarters of 2023. This was announced by Department of Trade and Industry (DTI) Undersecretary Ceferino Rodolfo during a recent press interaction.

According to Philippines News Agency, who also serves as the Managing Head of the Board of Investments, the Philippines recorded a 15.93-percent decline in net FDI inflows from January to September of the previous year. This decrement, though notable, was less severe compared to neighboring countries. Indonesia experienced an 18.75 percent drop, Thailand a 50.75 percent decrease, and Malaysia a significant 61.31 percent decline.

For the first three quarters of 2023, the Philippines’ net FDI inflows stood at USD 5.88 billion, surpassing Malaysia’s USD 4.99 billion and Thailand’s USD 4.44 billion. This performance positions the Philippines as the third highest in net FDI inflows in Southeast Asia, trailing behind Vietnam at USD 15.91 billion and Indonesia at USD 16.33 billion, excluding Singapore.

Rodolfo expressed optimism about the country’s FDI prospects. “We are really hopeful that at the end of the President’s term, we would be the second biggest destination of FDIs in Southeast Asia,” he said. He attributed this potential to the pipeline of investments attracted during President Ferdinand R. Marcos Jr.’s foreign trips and the outbound investment missions of investment promotion agencies (IPAs), focusing on sectors like renewable energy, mineral processing, and manufacturing.

In terms of investment goals for 2024, DTI Secretary and BOI Chair Alfredo Pascual stated that the IPA aims to achieve PHP 1.3 trillion to PHP 1.5 trillion in investment approvals. This target represents a 3 to 19 percent increase from the PHP 1.26 trillion approved by the BOI Board in 2023. The BOI had initially set a target of PHP 1 trillion for the previous year before increasing it to PHP 1.5 trillion in early 2023.

BOI Director Eries Cagatan explained that the IPA was PHP 240 billion short of its target approvals last year. She noted that PHP 272 billion worth of projects discussed by the Board could not be approved due to pending compliance in the energy sector.

Looking ahead, BOI Director Ernesto Delos Reyes revealed that there are PHP 930 billion worth of investment prospects for 2024. These prospects are part of the One-Stop Action Center for Strategic Investments (OSAC-SI), or the green lane, which Delos Reyes leads. He highlighted that PHP 370 billion of applications in the OSAC-SI have already received the Green Lane Certificate of Endorsement, PHP 360 billion are under evaluation, and PHP 200 billion is an incoming application from SP New Energy Corp. (SPNEC) for what is projected to be the world’s largest solar project.

The government’s commitment to fostering a conducive environment for investments was further emphasized by Executive Order 18 signed by President Marcos in February 2023, directing national and local government units to expedite the processing of licenses and permits for high-impact projects.