President Marcos signed the decree after its approval by the House of Representatives and the Senate. “We are about to enter a new era of sustainable progress,” he said. The opposition is against the project, as are several business groups, figures from the academic world and civil society.
Manila () – Less than six months after declaring his explicit support for the controversial sovereign wealth fund, even then, the president Ferdinand Marcos Jr. signed a law officially creating the Maharlika Investment Fund (MIF).
“This is a bold step towards a major economic transformation of our country. Just as we recover from the negative effects of the pandemic, we are now preparing to enter a new era of sustainable progress, stability and the broad empowerment of our markets,” said ‘Bongbong’ Marcos in his speech after signing the administrative measure. And he added: “For the first time in the history of the Philippines, we have a sovereign wealth fund to guide our economic development.” The MIF, formerly known as the Maharlika Wealth Fund, will be used to invest in domestic and foreign securities, commercial real estate and infrastructure projects.
Marcos had presented the fund during his trips abroad, particularly when he flew to Switzerland to attend the latest edition of the World Economic Forum last January. However, from its first presentation, the MIF unleashed criticism from the opposition for the possible infiltration of investments. Minority leader Aquilino Pimentel III, who serves in the Senate, had asked Marcos to veto the measure. According to Pimentel, the law would divert to the world of finance resources that could be used to solve the country’s immediate problems, such as the deficiencies in Education and Health.
The Investment Fund runs into opposition from various business groups, academic circles and civil society. The main concern is the use of state pension funds as start-up capital. In addition to questioning the funding sources, some experts have complained that taxpayer money accumulated for Maharlika could be used to directly finance certain high-risk projects due to market fluctuations.
In the meantime, there are already Canadian companies that have expressed interest and want to invest in the Philippine fund. Among them are the Canadian investment management company and pension funds that wink at Marcos and are willing to do business in the country, according to the Finance Department.
Chronicle of the controversial approval
In December 2022 – when the House of Representatives was deliberating the sovereign wealth fund measure, but the Senate had not yet taken it up – Marcos first defended the fund, stating that it would be “beneficial” for the Philippines.
In mid-January, the Chamber – chaired by Marcos’s cousin, President Martin Romualdez – approved the administrative measure to establish the fund. It was then that President Marcos granted the bill the character of “urgent”, which meant that it had to be debated in the Senate, speeding up the times and giving legislators less time to analyze it.
The Senate, also dominated by a “supermajority” allied to Marcos approved the measure to create the sovereign wealth fund -even so, it took longer than the Chamber to deliberate on the project. Today he delivered the act to Marcos for the signing and promulgation of the law.
It is worth mentioning that the Maharlika fund does not seem to have been Marcos’s idea, but it did originate in the Malacañang Palace – the official residence of the president. In fact, Marcos Jr did not refer to the project during his last speech on the state of the nation, when presidents usually explain his priorities for the next legislative year.
Photos: RTV Malacañang (state TV)
