The national government and state-owned banks and financial institutions will raise more than P200 billion to fund the proposed Maharlika Wealth Fund, according to Finance Secretary Benjamin Diokno.
Diokno said in an interview at the sidelines of Securities and Exchange Commission’s 86th anniversary Tuesday evening the government has enough funds to support the creation of a sovereign wealth fund.
House Speaker Martin Romualdez earlier filed House Bill No. 6398 calling for the establishment of the Maharlika Wealth Fund—patterned after the sovereign wealth funds of other countries “to maximize the profitability of investible government assets for the benefit of all Filipinos”.
A sovereign wealth fund is a government-owned fund that invests in various assets such as real estate, foreign currencies, equities, corporate bonds, precious metals and other investment instruments.
Diokno said state pension funds and government-owned banks and financial institutions agreed to support the proposed investment fund.
“There is already a commitment from Government Service Insurance System, Social Security System, Land Bank of the Philippines and Development Bank of the Philippines and the national government,” Diokno said.
“We have money for it,” he said.
The proposed Maharlika Wealth Fund is patterned after the SWFs of 49 countries including Singapore, China, Hong Kong, South Korea, Malaysia, Indonesia, Taiwan, Vietnam and East Timor.
“The president will appoint people, and there will be a governing council. Some cabinet members will be there. It will be an independent body,” Diokno said.
Romualdez said in his proposed bill the creation of MWF would provide an “opportunity to ensure their respective funds’ optimal asset allocation as well as ensure that resources are efficiently channeled to investments that will provide the most value not only to the participating GFIs but also to the country.”
The House committee on banks and financial intermediaries already approved in principle HB 6398, which proposes an initial investment of P250 billion from the GSIS, SSS, LandBank and DBP and another P25 billion from the national government.
The bill states that governments invest wealth funds in an array of both real and financial assets to stabilize national budgets, create savings for their citizens or promote economic development.
It says the fund would give government financial institutions the opportunity to ensure their respective funds’ optimal asset allocation and ensure that resources are efficiently channeled to investments that will provide the most value not only to the participating GFIs, but also to the country.