BSP’s Medalla okay with Senate version of Maharlika bill

MANILA, Philippines — Bangko Sentral ng Pilipinas Governor Felipe Medalla said the Senate’s version of the proposed sovereign wealth fund is “okay,” but he said that it has transformed into something different altogether.

“For instance, it’s no longer a sovereign wealth fund. It’s now more of a national development fund,” Medalla said when asked by reporters at the sidelines of a FinTech Alliance.ph event on Monday.

“It’s now an investment fund now, I think targeting strategic objectives of the national government. Maybe including climate change. I don’t know what it will be used for but the way it’s evolving now, it will have many good governance principles,” he added.

Senate lawmakers are on the verge of passing the country’s version of a sovereign wealth fund, months after the Marcos Jr. administration floated the idea to the public.

The Maharlika Investment Fund, as it was not previously known, was tweaked several times to make the proposal more palatable for the public. In its initial iteration, the proposal sought to include taxpayers’ pension funds, under the Social Security System and the Government Service Insurance System, to bankroll the wealth fund.

The criticism proved loud and lawmakers omitted those, instead choosing to build seed funding from contributions pooled from the BSP, and two state-led banks, the Development Bank of the Philippines and Land Bank of the Philippines.

The proposal of creating a sovereign wealth fund faced harsh criticism from civil society, academia and the private sector, as many questioned its viability, on how it will be managed and even the logic of creating one.

Economic managers of the Marcos Jr. administration are keen on the passage of investment fund before the State of the Nation Address. — Ramon Royandoyan