If the proposed Maharlika Wealth Fund is done properly, it could actually work and would present vast investment opportunities, Go Negosyo Founder Joey Concepcion said.
“Done properly, I think it’s a good idea,” Concepcion said.
The former presidential adviser for entrepreneurship stressed that if the sovereign wealth fund, whose creation is set to be deliberated by Congress as House Bill 6398, is able to address its trust and timing issues, it could present vast investment opportunities for the Philippines.
Among the benefits that Concepcion sees is the opportunity to invest in big-ticket projects and the service of experts and professional managers from the private sector.
“Through these funds, people can participate in these big projects, and not just the big, private funds will benefit from the earnings,” he said.
“We missed out on opportunities like Transco, Malampaya, BGC and Semirara because we didn’t have a fund like this when these were bidded out. Transco was already profitable, and then the private sector took it to another level. The land value now in BGC has skyrocketed, and Semirara’s productivity has increased. Imagine how much the country could have earned if we had a fund like this back then,” he added.
While it is still not clear how the fund will operate, Concepcion pointed out that the government must assure the public that "it will be run by people who have no conflicts of interest and are very capable of turning in a profit for the fund."
Concepcion emphasized that the fund’s Board of Directors should be composed of prominent and well-respected Filipino businessmen. He also said that having the President as chairman will ensure that the fund will survive beyond his administration.
He further said that the fund should invest mainly in Philippine infrastructure and should limit its exposure to 10 to 20 percent in its investments.
“It could be a passive investor,” he said, saying that with infrastructure investments such as roads and tollways, the fund can continuously earn profits.
“These privatizations were participated in by the conglomerates and most of them have been very successful. They have the track record, so what is our risk? They can bid for it and they can manage it; we can ride on that for no more than 20 percent stake,” he said.
“We have to remember, there are a lot of opportunities now in the Philippines. It would be nice if the fund can invest in the reclamation of Manila Bay, for example, because that’s a sure winner,” he said.
Meanwhile, Concepcion recognized that it is now gaining criticism due to its timing.
“I understand why it’s an unpopular proposal. We have just come out of the pandemic and we are all feeling the rise in interest rates and high prices,” he said.
However, he said that these headwinds are not insurmountable and should not deter the country from planning beyond the current crises.