Bangko Sentral: Philippines a ‘Solid’ Destination for Foreign Investments
Amidst the report that foreign investors were exiting the country, Bangko Sentral ng Pilipinas (BSP) Governor Nestor Espenilla said on Thursday that the country is a solid investment destination.
The report, citing the Copley Fund Research that analyzed 180 emerging market funds, was published by the Financial Times. It states that the average fund weight of emerging market investors in the Philippines fell to 0.87 percent, which is the lowest since 2011.
According to the Financial Times, over the past year, 83 percent of funds cut their holdings in the Philippines, and only 58 percent now have any funds at all. Vehicles run by BlackRock, Fidelity, Ashmore, Carmignac, and Pictet were included in the study.
The pace of the BSP’s interest rate hike as well as the potential uncertainties under the Duterte administration were also mentioned in the report.
“The BSP conducts monetary policy based on what we think is best for our economy,” said Espenilla in a statement.
“It’s too bad if a number of these funds currently find our investment profile to be incompatible with their profit goals,” he added.
The BSP Governor also hoped that foreign funds “reconsider once they realize the Philippines remains a solid investment opportunity with a strong growth story and considerable upside.”
BSP Deputy Governor Diwa Guinigundo said that the concerns in the Financial Times report are “misplaced.”
“On the central bank being behind the curve, we don’t really know where the analytics of this assessment is coming from,” Guinigundo said.
Guinigundo also mentioned the higher oil prices in the world market being the cause of inflation.
“When the supply pressures proved protracted, the BSP did not hesitate and increased the policy rate three times in May, June and August for a total of 100 basis points,” he said.
via ABS-CBN News