The Bangko Sentral ng Pilipinas expects more foreign direct investments inflow into the country in this year. The export related industries are likely to be the major beneficiaries of the higher FDI. A BSP official said that the central bank is reassessing its FDI projection of US$1.2 billion for this year due to the fact that the major portion of FDI approvals came in Q3/2005. The BSP official quoting details from the National Statistical and Coordination Board had earlier said that most of the FDIs that were approved in Q3/2005 pertained to manufacturing, business process outsourcing, real estate and mining sectors.
The government expects to attract higher investments on the back of its better performance in narrowing the budget deficit. In 2005, government’s budget deficit reached PHP146.5 billion, lower than the targeted deficit of PHP180 billion. The net FDI inflows reached US$1.1 billion during Jan.-Nov. 2005, an increase of 70% y/y from US$624 million during the corresponding period of the previous year. FDI as at end November 2005 surpassed BSP’s projection of US$971 billion for 2005.