THE Philippines has made it to the top five host economies of renewable energy investments in the Developing Asia and Oceania region from 2015 to 2022, according to the World Investment Report 2023 released by the United Nations Conference on Trade and Development (Unctad).
The Unctad report, published on July 5, 2023, showed that in the Developing Asia and Oceania region, the top host economies for international renewable energy projects are India, Vietnam and Taiwan Province of China, which attract more than 40 percent of the projects.
The remaining 14 percent in the region was shared by the Philippines and Indonesia, out of the total 54 percent share of the five economies.
Between 2015 and 2022, Unctad noted that Ayala Group is the top investor in renewable power in the Philippines, with 31 projects in the country.
Meanwhile, in a statement on Wednesday, the Unctad called for “urgent support” to developing countries, which includes the Philippines, to enable them to attract significantly more investment for their transition to clean energy.
“Developing countries need renewable energy investments of about $1.7 trillion annually but attracted foreign direct investment in clean energy worth only $544 billion in 2022,” noted the Unctad World Investment Report 2023.
For her part, Unctad Secretary-General Rebeca Grynspan said, “A significant increase in investment in sustainable energy systems in developing countries is crucial for the world to reach climate goals by 2030.”
Last month, the Philippines’s Trade and Industry Secretary Alfredo E. Pascual said renewable energy (RE) projects are seen to account for a third of the Board of Investments (BOI) P1.5-trillion investments approval target for 2023.
The country has allowed 100-percent foreign investments in renewable energy in its bid to attain a 35-percent share of renewable energy in the country’s energy mix by 2030 and 50 percent by 2040.
The World Investment Report 2023 showed that foreign direct investment (FDI) inflows for the Philippines declined by 23.2 percent from $11.9 billion in 2021 to $9.2 billion in 2022.
Meanwhile, global FDI declined by 12 percent in 2022, to $1.3 trillion, after a strong rebound in 2021 following the steep drop induced by Covid-19 in 2020, the report showed.
Unctad said the decline was mainly a result of lower volumes of financial flows and transactions in developed countries. The slowdown was driven by overlapping crises: the war in Ukraine, high food and energy prices and debt pressures.
The fall in FDI flows was mostly caused by financial transactions of multinational enterprises in developed economies, where FDI fell by 37 percent to $378 billion.
“The global environment for international business and cross-border investment remains challenging in 2023. Geopolitical tensions are still high. Recent financial sector turmoil has added to investor uncertainty,” Unctad said in a statement on Wednesday.
With this, Unctad said it expects downward pressure on global FDI to continue in 2023.
Image credits: Hrlumanog | Dreamstime.com