Romualdez bats for creation of sovereign wealth fund for Pinoys


House Speaker Martin Romualdez has filed a bill pushing for the creation of a sovereign wealth fund (SWFs) that will improve investment opportunities for Filipinos.

House Speaker Martin Romualdez (Photo from House of Representatives via Twitter)

House Bill (HB) No. 6398, if enacted, would establish the Maharlika Wealth Fund (MWF). This would draw resources primarily from the Government Service Insurance System (GSIS), Social Security System (SSS), Land Bank of the Philippines (LandBank), and Development Bank of the Philippines (DBP) contributions.

Romualdez said the government has to “improve investment opportunities, promote productivity-enhancing investments, and ensure that the Philippines becomes an investment destination” in order to achieve the objectives of the Agenda for Prosperity and the eight-point socioeconomic roadmap of President Ferdinand “Bongbong” Marcos Jr.

The Speaker added the MWF “will provide for the management, investment, and use of the proceeds of the fund.”

"Sovereign wealth funds are state-owned investment funds typically financed by a country’s surplus revenues or reserves. Governments invest these funds in an array of both real and financial assets to stabilize national budgets, create savings for their citizens, or promote economic development,” he noted.

Under the measure, the GSIS, SSS, LandBank, and DBP will be given the 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.”

Co-authors of the bill are House Majority Leader Manuel Jose “Mannix” M. Dalipe, senior Deputy Majority Leader Sandro Marcos, Tingog Party-list Reps. Yedda Marie Romualdez and Jude Acidre, and Marikina City Rep. Stella Luz Quimbo.

The proposed MWF is patterned after the sovereign wealth funds of 49 countries, including Singapore, China, Hong Kong, South Korea, Malaysia, Indonesia, Taiwan, Vietnam, and East Timor.

The Speaker cited Singapore and Indonesia that both successfully used their sovereign wealth funds.

He said Singapore’s SWFs provide the financial means for the city-state “to manage its foreign reserves, defend itself and protect its sovereignty without compromising its domestic program, and augment its land-limited economic space with global investments.”

On the other hand, Indonesia’s SWF has attracted foreign investors to jointly capitalize its SWF to bring in much-needed investments in such sectors as transportation, including airports, supply chains, logistics, digital infrastructure, the green economy, healthcare services, amd the financial sector, among others.

“As the Philippines secures its place not only as the Rising Star of Asia but as a real economic leader in the Asia Pacific, the creation of the MWF becomes imperative,” Romualdez stressed.

He said the MWF would also adhere to the Santiago Principles of the International Forum on Sovereign Wealth Funds (IFSWF) to ensure transparency and accountability.

Under the bill, the envisioned MWF would have a governing board, composed of nominees of the contributing GFIs, which would be in charge of managing the fund. The board would include two independent directors.