TOKYO – A high-ranking official of one of Japan’s leading financial institutions has expressed strong interest in the proposed Maharlika Investment Fund (MIF) and its potential to help the Philippine power sector, Speaker Martin Romualdez said on Friday.
In an interview with members of the Philippine media at Hotel Okura here, Romualdez noted that he met the Japanese senior official during the dinner held Wednesday night for President Marcos and members of the Philippine delegation, hosted by Mitsui and Metro Pacific Investment Corp.
“It was during our conversation that he expressed strong interest (in the MIF) and in the possibility of investment in the proposed sovereign wealth fund, particularly for the power sector,” Romualdez said.
“There is a strong interest, or strong potential interest, for investment in the sovereign wealth fund or Maharlika, particularly for the power sector,” the Speaker said.
According to Romualdez, the interest in the proposed MIF shown by the Japanese senior financial official is significant as he played a key role in setting up Indonesia’s sovereign wealth fund, the Indonesia Investment Authority (INA).
Reports said that since its launch in February 2021 with initial funding of $5 billion from the Indonesian government, INA had raised more than $20 billion of co-investments from other foreign parties by the end of 2022.
According to the Japanese official, the growth prospect of the proposed MIF is “potentially higher” compared to INA, Romualdez said.
The Senate is currently deliberating on its version of the MIF bill.
Romualdez said he expects a counterpart bill to be passed by the Senate before Easter.
“I have a funny feeling (that) in the Senate, it will pass soon. Maybe after Easter that’s (MIF bill) done already. Because they already saw the draft,” he said.
The Speaker said the sovereign wealth fund, which is present in over 70 countries, will attract both local and foreign investors.
“At the end of the day, because we know that the sovereign wealth fund will be a magnet for foreign investments, it will attract a lot of people overseas because they usually say — oh, we’ve been hearing a lot of good things about the Philippines – usually a sovereign wealth fund attracts a lot of foreign capital because those running the sovereign wealth fund are experts in the field of finance, trade and banking, known for their probity and their integrity,” Romualdez said.
Last Dec. 15, the House of Representatives approved the MIF bill, which was certified as urgent by Marcos, on third and final reading.
The bill gained the support of 90 percent or 282 out of the 312 members of the Chamber, who were officially named as co-authors of the measure.
Under the MIF bill passed by the House, the initial capitalization would come from Landbank worth P50 billion and the Development Bank of the Philippines worth P25 billion.
Albay Rep. Joey Salceda earlier said the MIF had been “rewritten and reengineered.”
In a hearing last Feb. 1, senators saw several loopholes in the proposed multibillion-peso MIF, including the lack of return on investments or ROI for state-run banks, as well as the composition of the board that will run the sovereign fund.
Sen. Francis Escudero said there was no provision in the bill that Landbank and DBP would have a part in the net profit, noting that it is like forcing the state-run banks to give money.
Escudero also said the MIF bill that may be passed in the Senate would likely be vastly different from the one passed by the House in December.
In an interview in January, Marcos assured the public that the money to be invested in the proposed MIF would be protected and would only be used for very specific and accountable projects.
Speaking at the World Economic Forum (WEF) in Davos, Switzerland last month, the President said the sovereign wealth fund is one of the government’s many efforts to diversify the country’s financial portfolio.