Revisions to Maharlika Investment Fund a welcome development: economist


Posted at Jan 23 2023 04:22 PM

MANILA — The revised version of the proposed sovereign wealth fund is a welcome development, an economist said Monday.

Under the "reengineered" Maharlika Investment Fund, seed funding will be taken from dividends of government-owned and controlled corporations or the securitization of some P42 billion in dividends.

The Bangko Sentral ng Pilipinas and the Development Bank of the Philippines have been dropped from the list of sources of capital for the MIF.

"We have actually highlighted before or even from the onset that DBP would be put in a precarious situation because of its smaller size and that it would have an impact on its capital and probably even leverage and liquidity ratios. So, that's good," Enrico Villanueva told ANC's "Headstart".

Being listed in the Philippine Stock Exchange will also be a good indicator of the MIF's performance, said Villanueva, a senior lecturer of money and banking at the University of the Philippines - Los Baños.

"Being listed in an exchange would mean there's a chance for the markets to question and analyze the investments of this corporation," he added.

Finance Secretary Benjamin Diokno has said the new MIF would be opened to foreign investors, which is similar to the version of Indonesia.

The House of Representatives has approved the proposal but the Senate is yet to discuss the sovereign wealth fund bill.

The proposed law, aimed at raising capital for big-ticket development projects, has been criticized by activists and opposition figures, as well as business groups.

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