Senior Deputy Speaker and former president Gloria Macapagal-Arroyo has bared what she believed was the upside to institutionalizing a Philippine sovereign wealth fund.
There is a serious push from the House of Representatives right now to set up the so-called Maharlika Wealth Fund (MWF), which--through a seed money of P275-billion--will be used to generate profits for the State via investments here and abroad.
"The government always has funds to invest, such as financial assets of government financial institutions (GFIs) or the reserves of the Bangko Sentral ng Pilipinas (BSP)," Arroyo said in a statement Monday, Dec. 5.
"Keeping this in mind, the proposed fund (MWF) has the following advantages:
First, the fund is seeded by investible funds from GFIs that they would invest, anyway, in order, ideally, to maximize returns and generate funds that contribute to or supplement the financial resources at the disposal of the government for programs and projects that benefit the Filipino people," she said.
"Second, the fund will have an established mechanism for future contributions," noted the Pampanga 2nd district congresswoman.
As a third advantage, Arroyo said the MWF "will benefit from a centralized, specialized, and accountable management". This echoes proponents' remarks that the MWF would be run like a corporation, with the only politician in the MWF Board being the President, who is the chairman.
"In the current version of the Maharlika Wealth Fund, the President of the Philippines chairs its governing board. This is a powerful statement that the highest official of the land will hold himself as ultimately accountable to the Filipino people for the performance of the fund," she said.
"Fourth, the fund will in essence be housed in what can be thought of as a special purpose vehicle, and thus its operations can more transparently be observed, tracked, and monitored, not just domestically, but by the international financial community as well," Arroyo further said.
The proposed P275-billion MWF is contained in House Bill (HB) No.6398, which is expected to be approved on second reading by the plenary on Wednesday.