The Marcos administration should not expect the Senate to put all its time and energy for the immediate passage of the proposed Maharlike Investment Fund (MIF) which has been rife with a lot of ambiguities and questions regarding its real purpose and intent.
For now, Sen. Francis “Chiz” Escudero said he expects all of President Ferdinand “Bongbong” Marcos Jr.’s economic managers to return to the table and iron out the kinks in the proposed Senate Bill No. 1670 and House Bill No. 6608 which supposedly seeks to establish a sovereign wealth fund that could be tapped for the achievement of the country’s economic goals.
“Let's start from the beginning, like I said, it should be clear to them. Tell them what they aim and want to achieve by establishing this Fund. It can't be a jack of all trades, master of none,” Escudero said in an interview on GMA’s Radio DZBB, on Sunday, February 5.
“That's why I have no intention of rushing it. I wouldn’t use the word delay. I have no intention to rush until the economic managers are able to answer the simple questions and simple clarifications requested not only by members of the Senate, but also by many of our compatriots. This must be clear to them before we pursue, promote and pass this bill,” the senator added.
During the Senate Committee on Banks’ initial hearing on the bill, Escudero admitted he got confused as to the objective of the MIF, noting that the interpretation on the measure by the Department of Finance (DOF), the National Treasury, and other government financial institutions all differed from each other.
The senator pointed out the LandBank of the Philippines (LandBank), the Development Bank of the Philippines (DBP) and the Department of Budget and Management (DBM) were supposed to make individual presentations on the MIF, but he thumbed down their bid.
“Shouldn't the economic team stand as one? Only one person will present so when the DBM presented, the Central Bank (Bangko Sentral ng Pilipinas) would have presented, I did not allow it and I said it should have been said in the presentation of the National Treasurer who represents the entire economic team,” he pointed out.
“This is not the place for you to debate each other. This is a debate between the Senate and the Executive branch. Not a debate between Executive branch agencies. They should have ironed that out before they faced us,” Escudero said.
That is why the government should stop its “shotgun approach” on the measure.
“They cannot take a 'shotgun' approach. They can’t say it’s up to the board of directors; they can’t say it’s up to the crafting of the internal rules and regulations. In anything we do, it should be clear why we are doing it from the very beginning,” he said.
“Right now, their objectives seem like a ‘fruit salad’ depending on who you talk to. This bill has so many authors. That is why the objective of the MIF is not clear in the bill,” Escudero pointed out.
“We will not be able to start or sustain this if they use a shotgun approach. That would not work considering there are so many sovereign wealth funds, around 50, around the world used by different countries. We cannot just copy, or just imitate and yet it’s not clear to us what our purpose is,” he said.
Escudero questioned why the government is using the Temasek sovereign wealth fund of Singapore as a pattern for the MIF.
The senator pointed out that the purpose of Lee Kuan Yew, the prime minister of Singapore at the time Singapore built its own sovereign wealth fund in 1974, was to take over government corporations that were losing money and run them as private corporations.
“They fixed the problem using that concept and for the next 10 years, until 1984-85 that was all Temasek Holdings Corporation did,” he explained.
Twenty (20) years later, Escudero said, Singapore started investing in private corporations within the country first, and eight years later, invested in various corporations outside of Singapore.
“But Singapore's strategy is clear because they are a finance center, they do not invest in corporations that also focus on finance like the UAE sovereign wealth fund. They do not invest in companies that own oil. They invest in other investments that do not exist in their country,” he noted.
“The path they will follow is clear in their minds. We didn't even write that in the (MIF) bill),” the lawmaker stressed.
“So for example, we don’t have oil, then let’s invest on corporations in countries that are rich in oil. We lack rice, shall we invest in our agriculture sector of shall we invest in corporations in Thailand and Vietnam that produce rice?”