foreign investment – Page 3 – Author Carlo Carrasco

Nomura says America’s 19% tariff may cut Philippines GDP growth slightly

August 5, 2025July 28, 2025carlocarrasco

In the middle of mixed reactions towards the United States’ 19% tariff on Philippine exports, Nomura Global Markets Research stated that the country’s gross domestic product (GDP) growth could be cut by 0.4%, according to a BusinessWorld news report. Recently, US President Donald Trump and Philippine President Ferdinand “Bongbong” Marcos, Jr., met in the White House which resulted in the new tariff.

To put things in perspective, posted below is an excerpt from the news report of BusinessWorld. Some parts in boldface…

THE United States’ 19% tariff on Philippine goods could cut the Philippines’ gross domestic product (GDP) growth by 0.4 percentage point (ppt), Nomura Global Markets Research said.

In a report, Nomura said the US tariff of 19% on Philippine goods is “fairly high” and poses downside risks to growth.

“We estimate the direct effects could reduce our baseline GDP growth forecasts by a still-substantial 0.4 ppt in the Philippines.”

Nomura said this projection is “relatively substantial” compared to its baseline growth forecasts of 5.3% and 5.6% for this year and 2026, respectively.

“This is partly because we assigned 10% as the level where the reciprocal tariff rate could settle, on the assumption that the Philippines is a strong ally of the US and is not a third country for transshipments,” Nomura said.

“As it turns out, despite the visit to Washington by President Marcos and both sides reiterating the need for a strong partnership, the tariff was still set at 19%, which is even higher than the ‘Liberation Day’ level of 17%.”

Last week, Philippine President Ferdinand R. Marcos, Jr. met with US President Donald J. Trump at the White House in Washington, DC. Mr. Trump announced a 19% tariff would be imposed on Philippine goods, which will take effect starting Aug. 1.

“The trade ‘deals’ therefore represent upside surprises in terms of tariff rates, especially for the Philippines,” Nomura said.

“As a result, if implemented and these tariff rates are sustained, these will likely further weigh on growth in both countries relative to our current baseline forecasts.”

The government expects GDP to grow by 5.5-6.5% this year, lower than its previous target of 6-8%.

“While these ballpark estimates make sense to us, uncertainty remains high and these are ‘only’ taking into account the direct effects on these ASEAN countries’ exports to the US,” Nomura said.

These estimates do not account for sectoral tariffs, such as in semiconductors and pharmaceuticals, which are currently exempted, it added.

“But as our US team highlights, the risk is these could be set higher, though some countries could be exempted, adding to the uncertainty. As mentioned above, the details of the trade deals with Indonesia and the Philippines are still limited.”

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the Philippines is in a serious disadvantage with the American tariff of 19% imposed on the nation’s exports? Do you think the Philippine economy still has strong momentum to reach 6% GDP growth by the end of this year?

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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I Love Israel: Talks of possible Free Trade Agreement (FTA) to boost Israeli investments into the Philippines

August 5, 2025July 30, 2025carlocarrasco

In recent times, Israel’s Minister of Economy and Industry Nir Barkat visited the Philippines and he has officially confirmed that the Jewish state and the nation of Filipinos are starting the process for initial negotiations for a free trade agreement (FTA), according to a news article by the Philippine News Agency (PNA). If an FTA is realized sometime in the future, it would mean more Israeli investments coming into the Philippines.

To put things in perspective, posted below is the excerpt from the PNA news article. Some parts in boldface…

The announcement of the Philippines and Israel’s intention to pursue free trade agreement (FTA) talks is certain to bring in more Israeli investments into the country.

Visiting Israel Minister of Economy and Industry Nir Barkat said the Philippines and Israel “actually are starting the process” to initiate negotiations on a free trade deal.

“Usually, it takes few years to sign an FTA. By defining that we will, many investors will start collaborating now,” he told reporters on the sidelines of a reception in Taguig City on Tuesday night.

“When investors see that in a year, two years, at some point in time, there’s going to be an FTA, they (start) to invest already. The impact of announcing that we will be doing a deal together is quite immediate.“

Barkat said Israeli firms are eager to expand businesses on a number of areas, specifically agricultural technology and food technology in the Philippines. Israel, he said, is also intent on growing its already robust trade with the country.

“My goal is to have 10 times more trade in 15 to 20 years with all countries, including the Philippines. In order to scale to such volumes of trade, we need to put foundation for long term infrastructure, and that’s what we’re doing in this visit,” he told the Philippine News Agency in a separate interview.

Barkat said he sees the Philippines as a partner that could aptly “complement” Israel both by scale and scope.

In his 4th State of the Nation Address on Monday, President Ferdinand R. Marcos Jr. said the Philippines is ready to receive local and foreign investors, especially on agriculture.

This newest development shows the continuing growth of Israel-Philippines ties with trade in mind. Even though Israel remains fighting the Palestinian terrorist group Hamas in Gaza, the Jewish state still manages to have economic breakthroughs (click here and here). Given the fact that Israel won the 12-day War over terrorist state Iran, that alone is enough to be confident about Israel’s economy and the prospects of Israeli enterprises and entities investing overseas. Besides, the Philippines can benefit not only from the finances of Israeli investments, but also from Israel’s advanced technologies and job creation for Filipinos.

To my fellow Filipinos reading this, I encourage you to accept the truth that Israel is the land God designated specifically for the Jewish people (read Genesis 35:10-12) and His command must be followed without hesitation. If you want to be blessed further by the Lord, do so by loving and blessing the Jewish people (Genesis 12:1-3). I did my part when I was in Israel. Also, let me remind you all that the ties between the Jews and Christians are truly biblical!

I encourage you all to pray to the Lord God in support of Israel, to love and bless the Jewish people, and pray for the peace of Jerusalem. Pray to Him so that Israel-Philippines ties and cooperation will keep growing stronger and more resilient no matter what happens around the world.

If you truly believe in Lord Jesus, the Holy Spirit and God the Heavenly Father wholeheartedly and you continue to be faithful, you should be aware that Christians are meant to stand united with Israel and love the Jewish people no matter what. You can do your part supporting Israel by donating to Christians United for Israel (CUFI). Do not forget to read the Holy Bible, then pray in tongues to the Lord in the privacy of your room with the door shut.

Always be the fearless and aggressive church of Lord Jesus! Always stand in support of Israel and its ties with the Philippines!

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Investment firm Cerberus Capital Management will invest P15 billion more in the Philippines

August 4, 2025July 27, 2025carlocarrasco

While a lot of economists stated that the economy of the Philippines is unlikely to achieve 6% growth this year, the New York-based investment firm Cerberus Capital Management is investing an additional P15 billion in the country, according to a Philippine News Agency (PNA) news article. For the newcomers reading this, Cerberus is the operator behind the Agila Subic Shipyard.

To put things in perspective, posted below is an excerpt from the first PNA news article. Some parts in boldface…

New York-based alternative investment firm Cerberus Capital Management is investing an additional PHP15 billion in the Philippines within a year, as it sees progress in its existing operations and government support for foreign investors.

The company, which operates the 300-hectare Agila Subic Shipyard, the former Hanjin Shipyard in Subic Bay that it acquired in 2022, disclosed the plan during a meeting with President Ferdinand R. Marcos Jr. in Washington, DC earlier this week.

In a press release Friday, the company said the additional investments will be used to update the shipyard and introduce new projects in logistics, energy, and transport infrastructure.

Cerberus managing director Alexander Benard said they are “encouraged by the progress we’ve seen and by the strong support from the Philippine government.”

“We believe the Philippines holds significant long-term potential as a regional hub for industrial and logistics activity. We look forward to building on this momentum and supporting the development of our key strategic assets in the Philippines,” he said.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the economy of the Philippines will experience a breakthrough of additional foreign investments over the next six months?

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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2024 FDI net inflow into Philippines reaches $8.93 billion

March 21, 2025March 12, 2025carlocarrasco

Foreign direct investments (FDI) that flowed into the Philippines reached $8.93 billion in 2024 which is a tiny improvement over the previous year, according to a BusinessWorld news report. The result was below the target for 2024 set by the Bangko Sentral ng Pilipinas (BSP).

To put things in perspective, posted below is an excerpt from the BusinessWorld report. Some parts in boldface…

NET INFLOWS of foreign direct investments (FDI) into the Philippines inched up by just 0.1% in 2024 but plunged in December to its lowest monthly tally in 11 years, amid uncertainty in global trade, data from the central bank showed.

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed FDI net inflows edged higher to $8.93 billion in 2024 from $8.925 billion in 2023, ending two straight years of declining inflows.

The 2024 FDI tally was also the highest in two years but below the BSP’s forecast of $9 billion.

Investments in equity and investment fund shares rose by 13.1% to $2.7 billion in 2024 from $2.39 billion in 2023.

Net foreign investments in equity capital climbed by 42.4% to $1.54 billion last year from $1.08 billion in 2023. Placements increased by 4.3% to $2.17 billion, while withdrawals fell by 37.1% to $628 million.

BSP data showed these placements mainly came from Japan (38%), the United Kingdom (35%), the United States (10%), and Singapore (8%).

Investments were mostly channeled into manufacturing (68%), followed by real estate (12%), and information and communication (5%) industries.

Meanwhile, net investments in debt instruments stood at $6.23 billion, down by 4.7% from $6.53 billion in 2023. Reinvestment of earnings likewise declined by 11.2% to $1.17 billion from $1.31 billion.

DECEMBER SLUMP – In December alone, FDI net inflows plunged by 85.2% to $110 million from $743 million in the same month in 2023. Month on month, inflows likewise fell by 88% from $922 million.

December saw the lowest FDI net inflow in 11 years or since the $102.16 million recorded in December 2013.

“While nonresidents’ net equity capital investments rose, FDI declined due to increased debt repayments by resident corporations to their nonresident direct investors,” the BSP said.

The higher debt repayments brought net investments in debt instruments to an outflow of $19 million in December, a reversal of the $618-million inflow in the same month in 2023.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the Philippines can do more to attract more foreign direct investments this year? Do you think the FDI of 2024 will result in new businesses and new jobs all over the Philippines this year?

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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Ayala-Mitsubishi deal likely to boost GCash IPO

October 30, 2024October 21, 2024carlocarrasco

If things go well, the recent deal made between Ayala Corp. and Japan’s Mitsubishi Corp. will likely boost the anticipated initial public offering (IPO) of e-wallet entity GCash, according to a BusinessWorld news report referencing analysts.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

THE RECENT deal between Ayala Corp. and Japan’s Mitsubishi Corp. is likely to increase the valuation of the anticipated initial public offering (IPO) of the electronic wallet GCash, according to analysts.

On Friday last week, Ayala Corp. announced that it was selling its 50% stake in AC Ventures Holding Corp. (ACV) to Mitsubishi for a minimum of P18.4 billion.

ACV owns 13% of Globe Fintech Innovations, Inc. (Mynt), which has two fintech companies, G-Xchange Inc., the operator of GCash, and Fuse Lending, a tech-based microlender.

“The deal reinforces the value of Mynt for its future IPO. With key investors coming in at a valuation of around $5 billion, Mynt is poised for an IPO at a much higher valuation,” Chinabank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.

GCash previously said it was planning an IPO but would wait for a more favorable market.

According to Mr. Colet, the IPO could happen as early as next year depending on market conditions.

“I can see the IPO within the next two to three years. Perhaps as soon as next year if market conditions are very good,” he said.

“So far, it seems Globe wants a local IPO for Mynt. But it would be better if they do a dual listing in the Philippines and a larger stock market to get the best of both worlds,” he added.

Globalinks Securities and Stocks, Inc. Trader Mark V. Santarina said in a Viber message that the deal helps GCash’s international expansion plans.

GCash services are available in 16 countries, including the United States, United Kingdom, United Arab Emirates, Italy, Australia, Canada, Germany, and other Asian countries.

“For GCash, Mitsubishi’s entry paves the way for potential international expansion, particularly into Japan, and may boost its service offerings in microlending and financial technology,” he said.

“While GCash is considering overseas listings for its IPO, there is still hope it may choose to list on the Philippine Stock Exchange (PSE) instead, which would be a significant win for the local market,” he added.

AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said in a Viber message that the deal could help improve other Ayala ventures.

“With its entry into ACV, Mitsubishi is not only buying into GCash but also into other ventures under ACV like Gogoro and Zalora. We believe Mitsubishi’s expertise can help improve these businesses and maybe even accelerate the expansion of GCash into Japan,” he said.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think an IPO of GCash could happen sometime in 2025? Are you an investor waiting for the GCash IPO to happen?

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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Improving foreign investment outlook for Philippines seen

September 12, 2024September 4, 2024carlocarrasco

As far as analysts are concerned, the foreign investment outlook for the Philippines is improving and should result in more investments, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

LOWER INTEREST RATES will help drive the entry of more foreign direct and portfolio investments into the Philippines, analysts said.

“The outlook for foreign direct investment (FDI) and foreign portfolio investment (FPI) in the Philippines appears promising, with current trends suggesting the country could meet or potentially exceed the Bangko Sentral ng Pilipinas’ (BSP) targets,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message.

The BSP expects to record FDI net inflows of $9.5 billion this year. For foreign portfolio investments, it forecasts $3.1 billion in net inflows by yearend.

“The BSP’s forecast for the year sounds reasonable, as it wouldn’t be too far a stretch, with that sort of level of annual FDI coming into the Philippines almost consistently over this period, barring the coronavirus-hit year in 2020,” Pantheon Macroeconomics Chief Emerging Asia Economist Miguel Chanco said in an e-mail.

In the January-to-May period, FDI net inflows jumped by 15.8% year on year to $4.024 billion, data from the BSP showed.

Meanwhile, short-term foreign investments yielded a net inflow of $1.46 billion in the January-July period, surging from the $157.3-million net inflows in the same period a year ago.

FDIs are considered long-term investments, while portfolio investments or “hot money” are seen as more fickle due to the ease by which these funds enter and leave the economy.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said the BSP’s investment targets are doable amid easing interest rates.

“Offering attractive rates will be the key. All around will be declining key rates, thus, offering sensible investments now will lock in gains for prospective investors. I would like to believe that there is time,” he added.

Mr. Roces said the further reduction in policy rates this year and next year “should stimulate investment activity, particularly for FDI, by making borrowing more attractive.”

At its August meeting, the Monetary Board cut rates for the first time in nearly four years or since November 2020. It reduced borrowing costs by 25 basis points (bps), bringing the benchmark rate to 6.25% from the previous over 17-year high of 6.5%.

The central bank could also deliver another 25-bp rate hike in the fourth quarter, BSP Governor Eli M. Remolona, Jr. said earlier.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you agree with the findings of the economic analysts pointing to improving foreign investment outlook for the nation?

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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