The Philippines gets a sovereign wealth fund
Maharlika Investments Fund looks like it will be a development vehicle that takes Indonesia for inspiration.
The Philippines is the latest developing country to get a sovereign wealth fund. Long-discussed, a sovereign vehicle was proposed in a bill introduced to the country’s parliament at the end of November. It will be called Maharlika Investments Fund.
Martin G Romualdez, Speaker of the House of Representatives (and cousin of president Ferdinand Marcos Jr), put out a press release explaining the new vehicle (calling it Maharlika Wealth Fund, slightly different to the name on the House bill). Through this, and through explanatory notes attached to the bill, we can draw some conclusions about what it will look like if the bill passes.
First: the size. The bill seeks total initial investments of P250 billion ($4.4 billion) from four government financial institutions, the Government Service Insurance System (GSIS); Social Security System; the Land Bank of the Philippines; and the Development Bank of the Philippines.
Then there will be annual contributions from three sources: the foreign currency equivalent of 10% of overseas Filipino workers’ remittances, 10% of the annual contribution of the business-process outsourcing sector, and 10% of gaming proceeds from the Philippine Amusement and Gaming Corporation.