With the final economic numbers of 2025 counted, it has been confirmed that approved foreign investments in the Philippines fell down by more than 50%, according to a news report by BusinessWorld.
To put things in perspective, posted below is an excerpt from the business news article of BusinessWorld. Some parts in boldface…
APPROVED foreign investments in the Philippines plunged by 50.1% year on year to P272.38 billion in 2025, its sharpest fall in five years, the Philippine Statistics Authority (PSA) reported on Thursday.
Preliminary data from the PSA showed that the value of foreign commitments approved by the country’s investment promotion agencies (IPA) in 2025 was lower than P546.19 billion in 2024.
This was the steepest drop in foreign investments since the 71.3% drop recorded during the pandemic in 2020. By value, this was the lowest amount of approved foreign investments since the P241.89 billion recorded in 2022.
Singapore was the top source of investment pledges for 2025 after committing P92.78 billion, or 34.1% of the total. It was followed by the Netherlands with P35.98 billion (13.2% share) and Japan with P34.03 billion (12.5%).
Analysts attributed the sharp drop in foreign investment pledges to the sluggish investor confidence in the Philippines arising from global trade uncertainties, natural disasters and the flood control corruption scandal.
“In a nutshell, the decline in approved foreign investment pledges in 2025 was driven by a mix of weaker investor confidence due to governance and corruption issues, global economic uncertainties, cautious corporate behavior, and an unusually high base of comparison from the previous year,” said Ser Percival K. Peña-Reyes, director of the Ateneo Center for Economic Research and Development.
Marco Antonio C. Agonia, an economist at the University of Asia and the Pacific, said uncertainty over the US tariffs may have also dissuaded foreign investors from setting up operations in the Philippines.
The United States imposed a 19% tariff on most Philippine goods beginning Aug. 7, 2025.
“Similarly, weaker growth prospects from repeated natural disasters and the flood control scandal may have encouraged foreign companies to scrap or defer their investment plans in the country,” Mr. Agonia said in an e-mail.
The Board of Investments (BoI) approved P150.34 billion worth of investment pledges in 2025, accounting for 55.2% of the total. It was followed by the Philippine Economic Zone Authority (PEZA) with investment pledges worth P107.06 billion (39.3% share), and the Bases Conversion and Development Authority (BCDA) with P7.01 billion (2.6%).
For 2025, about 45% or P122.48 billion of the total approved foreign investments will go to the energy sector, followed by manufacturing with P81.41 billion (29.9% share) and real-estate activities with P26.31 billion (9.7%).
In 2025, Calabarzon (Cavite, Laguna, Batangas, Rizal, and Quezon) cornered around P100.43 billion worth of these investment pledges. Central Luzon will get P70.74 billion while the Bicol Region got P50.76 billion.
Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the Philippines still has a lot of work to do and many challenges to resolve before it could convince foreign investors to come in? Do you think the national government is doing good enough to make the country attractive to foreign investors again?
You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.
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