The proposed Maharlika sovereign wealth fund can be good for the government and the economy if managed well and if enough safeguards are in place, an analyst said on Thursday.

State-run sovereign wealth fund taps international investments for bigger returns. But it is also vulnerable to corruption such as in the case of the 1Malaysia Development Bhd or 1MDB.

"It’s a wealth fund so you’re approaching different markets and I think its good for the government to pull something like that. As long as they have safeguards to prevent 1MDB fiasco, we should be alright. I think it’s a move in the right direction," said Investment & Capital Corp of the Philippines’ Equity Capital Markets Managing Director Manny Ocampo.

"It really becomes a question of who manages the fund, what are the checks and balances put in place," he added.

• Diokno says PH has money to back proposed Maharlika Sovereign Wealth Fund

Finance Secretary Benjamin Diokno on Wednesday said he supports the bill seeking to create the Maharlika Sovereign Wealth Fund filed by House Speaker Martin Romualdez.

Diokno said the Philippines has the money to fund the financial instrument. Managers will also be appointed and it would be supervised independently from the government, he said.

• Romualdez seeks sovereign wealth fund for PH