Philippine foreign direct investments in the first quarter of the year declined 16.6 percent on year to 471 million U.S. dollars as tensions in the Middle East and disasters in Japan dampened investors confidence.
"Investors remained cautious on account of the uncertainties brought about by the ongoing sovereign debt problems in Europe, the political unrest in the Middle East and North Africa region as well as the disasters that struck Japan," the Philippine central bank said in a statement issued Friday.
Most of the FDI inflows in the first quarter was recorded in the other capital account, consisting mainly of intercompany borrowing and lending between investors and their subsidiaries and affiliates in the Philippines.
Reinvested earnings amounted to 113 million U.S. dollars in the first three months of 2011 as foreign investors opted to put back corporate earnings to local enterprises.
Net inflows in equity capital rose 80 percent to 81 million U.S. dollars in the first quarter of the year quarrying sectors.
Major investors during the period were from the United States, Singapore and Hong Kong.