MANILA, Philippines — The Marcos administration has put up a microsite dedicated to the controversial Maharlika Investment Fund (MIF) as it faces criticism from sectors questioning its decision to push for the creation of the country’s first-ever sovereign wealth fund.
The Maharlika microsite, which can be accessed through htts://maharlika.dof.gov.ph, contains press releases, statements, videos and photos related to the MIF and the law that established it.
One of the sections of the microsite contains the joint statement of economic managers justifying the push for the wealth fund and describing it as a “vehicle for economic growth.”
In a Facebook post, the Presidential Communications Office encouraged the public to visit the microsite to access updates about the MIF.
Last Tuesday, President Marcos signed Republic Act 11954 creating the MIF in a move that officials claimed would accelerate the implementation of key infrastructure projects. The MIF, intended to become a vehicle to make profitable investments, would help the country achieve its goal of 6.5 to 8 percent economic growth in the medium-term, the President said.
However, some sectors claimed that the MIF is unnecessary, prone to politicization and poses serious risks to the economy.
Bayan Muna has announced a plan to challenge the MIF law’s legality before the Supreme Court, claiming that some lawmakers and the public were not able to read the final text of the measure before it was enacted.
Economist-legislator Rep. Joey Salceda, however, sees the new MIF law as a way to keep about P13 trillion in investible funds of private corporations that would make local economy growing as the government tries to recover from the pandemic.
“We have some of the largest conglomerates in Southeast Asia, and they are cash cows,” said Salceda, chairman of the ways and means committee of the House of Representatives.
He noted that the “total corporate sector generated P9.03 trillion in 2023.”
“Based on my analysis of the top 1000 corporations in the country alone, from year 2000, some P13 trillion in funds have been issued in dividends outside the country or used to pay foreign debt instruments,” the Albay congressman revealed.
“I see Maharlika as a way to keep that money in,” Salceda predicted. “They (top companies) have a gross saving of P5.7 trillion. So, basically, they don’t have anywhere to put 63 percent of all the money our corporations make.”
The House official said he obtained the figures from the Philippine Statistics Authority’s Income and Outlay Accounts.
“With MIF, investors can outsource those issues to a government-owned company, instead of doing all that on their own. That makes the job easier and the investment less risky,” the senior administration lawmaker justified further.
As far as Salceda sees it, MIF can deter the risk of local investors in putting their money overseas.
“Unless we create a vehicle for investable projects, chances are, that (top firms’ funds) is going to be released in dividends outside the country or used to pay foreign corporate debt, rather than develop our domestic sectors,” he explained.
Rep. Zaldy Co, chairman of the House appropriations committee, said that with the establishment of MIF, the Marcos administration is now “taking a bold step towards our country’s economic transformation.”
“This sovereign wealth fund will enable us to make strategic investments that will drive sustainable growth and contribute to the overall development of the Philippines,” the Ako Bicol party-list congressman said.
Co, head of the 54-member Party-list Coalition Foundation Inc., said the MIF holds the promise of “unlocking new opportunities and driving progress through investments in key sectors such as socioeconomic development and infrastructure.”
“Returns from the projected investment could be used, in theory, to bankroll socioeconomic and infrastructure projects, ensuring the betterment of our society and uplifting the lives of our fellow Filipinos,” he said.
Deputy Speaker Ralph Recto urged Marcos’ economic managers to prove Maharlika critics wrong, protect Marcos and take up the cudgels for him, especially since doubts have been raised on its fiscal viability.
“The next order of the day is to shut down the critics. And because they (economic team) have stuck out their necks for this, their professional reputation is also on the line. This is not just business, but personal,” Recto said.
The congressman from Batangas’ sixth district urged them to “prove their critics wrong, and deliver the earnings they confidently promised during the congressional debates on the measure,” most particularly because the law “was written largely faithful to the specs of the proponents.”
“Brickbats can incentivize performance and a powerful motivation to prove the naysayers wrong. And just like in car manufacturing, the design has already been approved,” Recto, a former senator, demonstrated further.
What congressmen and senators only did was to “add safety features against abuse and misuse of funds, and higher qualifications for those on the driver’s seat... It cannot be that the only thing good is the accelerator. An effective brake system is also as important to avoid accidents.”
Recto also urged “appointing authorities” to get “the best and the brightest” in running what is “the Republic’s sovereign fund” that will be used to finance projects “we need today while it earns so that it can fund future ones.”
Build better more
Meanwhile, Japanese Ambassador Kazuhiko Koshikawa said his country continues to stand with the Philippines in advancing strategic infrastructure development in line with the “Build Better More” strategy.
Marcos led on Wednesday in welcoming the inaugural train ride of the 4th generation Light Rail Vehicles of the Light Rail Transit Line 1 at the LRT-1 Baclaran Depot.
Koshikawa and Transportation Secretary Jaime Bautista also took part in the ceremony to commemorate this first ride.
In his message, Koshikawa expressed the great value of the ceremony to the bilateral ties of Japan and the Philippines.
“Today’s ceremony is undeniable proof that the strategic partnership between Japan and the Philippines cannot be deterred, even amid the pandemic. We expect these cutting-edge train coaches to provide the commuting public with faster, safer, more comfortable and more reliable rides throughout the city,” Koshikawa said.
The provision of 120 new light rail train sets forms part of the “Capacity Enhancement of Mass Transit Systems in Metro Manila Project” funded by the Government of Japan through the Japan International Cooperation Agency (JICA), in support of the LRT-1 Cavite Extension Project. – Delon Porcalla, Pia Lee-Brago