MANILA — Foreign direct investments (FDI) in the Philippines recorded net inflows of USD560 million in December 2025, up from USD427 million in the same month in 2024, the Bangko Sentral ng Pilipinas (BSP) reported.

Data showed that Japan was the largest source of FDI, with most investments directed to the financial and insurance sectors.

FDI includes investment by a non-resident direct investor in a local enterprise with at least 10 percent equity, as well as investments by non-resident subsidiaries or associates. These can take the form of equity capital, reinvested earnings, or borrowings.

For the full year of 2025, FDI net inflows declined to USD7.8 billion from USD9.4 billion in 2024. Equity capital placements mainly came from Japan, the United States, Singapore, and South Korea, and were largely channeled into manufacturing, wholesale and retail trade, and financial and insurance industries.

Rizal Commercial Banking Corporation chief economist Michael Ricafort attributed the decline in FDIs to political uncertainty, which prompted some investors to adopt a wait-and-see approach.

“For the coming months, improved governance standards and reforms would help improve international investor confidence and sentiment, including for FDIs,” Ricafort said.