The Bangko Sentral ng Pilipinas, or BSP, on Monday reported foreign direct investments or FDIs to the Philippines decreased by 3.9 percent to $484 million in June from $503 million in the same period last year, representing foreigners' lower share of equity capital or stocks in domestic firms. BSP said foreigners' net investments in equity capital, excluding reinvestments of earnings, shrank by 11.8 percent from $126 million to $111 million.

Meanwhile, their reinvestments of earnings decreased by 26.8 percent from $122 million to $89 million.

Most of the foreign contributions to equity capital of domestic firms came from Japan, the United States and Singapore.

Manufacturing firms received the most equity capital infusion, with 54 percent of the total. They were followed by real estate firms with 15 percent, and information and communication companies with 7 percent.

Weak growth jitters

"The slowdown in FDI may be due largely to investor concerns over weak growth prospects amid persistent global uncertainties," the BSP said.

Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said investors expected lower returns as the global scale of high inflation signaled restrained consumer demand.

He added high interest rates also slowed operations of many businesses as countries continued to recover from the pandemic.