Recent data indicate the significant impact of the state visits of President Ferdinand R. Marcos, Jr., together with Department Trade and Industry (DTI) Secretary Fred Pascual and other Cabinet officials, on the Philippine economy as the national government recorded a notable increase in net foreign direct investments (FDI) inflows across various sectors and a reduction in the unemployment rate last year.

Based on the report of the Bangko Sentral ng Pilipinas (BSP) covering January to November 2023, Manufacturing led in gross placements of equity capital with 50%, followed by Real Estate (15%) and Financial and Insurance (12%). FDI net inflows surged by 27.8% year-on-year to USD1.048 billion in November 2023, up from $820 million recorded in November 2022. This growth broke three consecutive months of contraction.

“Indeed, we are making it happen in the Philippines. The pipeline of projects initiated during President Marcos Jr.’ presidential visits, along with the goodwill fostered, is starting to yield tangible results, as shown by the latest FDI report from BSP. From January to November last year, we observed a substantial rise in FDIs in manufacturing and a significant surge in FDIs originating from Germany,” said Secretary Fred Pascual who is also the chairman of the Board of Investments (BOI).

During the first 11 months of the year, Japan (USD667.58 million), Singapore (USD158.88 million), Germany (USD149.80 million), and the United States (USD110.8 million) emerged as the primary sources of equity capital placements. Germany garnered the highest increase in growth rates, jumping by 1,571.83 percent from USD 8.96 million in January to November 2022 to USD 149.80 million for the same period in 2023.

One significant example of FDIs coming to fruition is the Php649 million Infinivan domestic subsea submarine cable project that registered with the BOI in December 2023. The 40% Japanese-owned venture, which is aimed at providing faster fiber internet speeds for Filipinos, has already activated key areas in the country including Iloilo, Bacolod, Boracay, and Caticlan. Notably, President Marcos, Jr. led the lighting-up ceremony of the Philippine Domestic Submarine Cable Network (PDSCN) on 15 February 2024.

Through initiatives such as this, the Philippines reaffirms its commitment to bolster investments broadening internet accessibility for its citizens. Such efforts also contribute to improving the country’s global ranking in broadband and mobile internet speed and coverage.

FDIs play a pivotal role in driving economic growth, fostering technological advancements and generating employment opportunities across various Southeast Asian nations. As highlighted by the BSP, net inflow of FDIs is a crucial indicator of the Philippines’ investment climate, which are firm capital inflows that offer employment opportunities.

Following the recent presidential visits, the influx of investments has injected vitality into the Philippine economy that leads to tangible improvements, particularly in employment figures.

Meanwhile, according to the Philippine Statistics Authority (PSA), the number of unemployed Filipinos decreased. The number of unemployed individuals aged 15 and above dropped to 1.6 million in December 2023, down from 1.83 million in the preceding month. The Philippines recorded a 96.9% employment rate in December 2023, which indicate that 50.52 million Filipinos were employed and mark a slight uptick from the 49.64 million employed Filipinos recorded in November 2023.

In the third quarter of 2023, the manufacturing industry recorded a surge in employment, with a 53.45% increase in investments by both foreign and Filipino nationals. Similarly, the mining industry saw a significant rise, reaching 35.71%.

“Certainly, the presidential visits have been impactful for the Philippine economy, signaling to both local entrepreneurs and foreign investors alike the government’s commitment to fostering a conducive environment for economic prosperity. The Philippines has become a premier investment destination for foreign businesses in Asia,” Secretary Pascual highlighted.

The administration’s policies were welcomed by investors, particularly projects in renewable energy and other strategic investments. Green lanes have sparked strong interest among investors eager for streamlined approval processes. As of 8 February 2024, the BOI has granted green lane certification to 41 projects, with 20 projects either having submitted commitments during the presidential visits or directly resulting from follow-through activities.

Further, the DTI emphasizes that while presidential visits serve as effective avenues for securing investment pledges, realizing projects requires persistent follow-through and strategic partnership. As investments materialize, the Philippines will reap the long-term benefits of sustained economic expansion and employment generation. “We will keep our momentum to make more investments happen in the Philippines by turning investment pledges from presidential visits into reality. Each presidential visit is important and sets a foundation for us to build a pipeline of investment opportunities that will translate to job generation for our countrymen,” said the DTI secretary. ♦

Date of release: 19 February 20024