Philippines moves closer to wealth fund plan with House approval

THE Philippines has moved closer to setting up a sovereign wealth fund after the House of Representatives approved a measure pushed by President Ferdinand Marcos Jr, just over two weeks after it was filed.

In a session late Thursday, 279 lawmakers voted in favour of the Maharlika Investment Fund while six voted against it, according to proceedings streamed on Facebook. The bill now goes to the Senate where it has to be cleared before being transmitted to Marcos for approval. 

The move comes after economic managers including Finance Secretary Benjamin Diokno and central bank governor Felipe Medalla backed the wealth fund plan. Medalla said Thursday the monetary authority’s earlier concerns over the planned sovereign wealth fund have been “completely addressed” after the proposal in Congress was revised.

The central bank chief initially aired concerns over the wealth fund’s potential governance issues and impact on the monetary authority’s independence. The bill’s revised version seeks to tap the Bangko Sentral ng Pilipinas’ dividends to the government for funding.

The bill was filed on Nov 28 by lawmakers including House Speaker Ferdinand Martin Romualdez, a cousin of the president, and presidential son congressman Sandro Marcos. Apart from dividends from the central bank, the initial fund of the planned entity would come from state-owned lenders Land Bank of the Philippines and the Development Bank of the Philippines, according to the bill.

President Marcos, who had certified the bill “urgent”, earlier said the proposed sovereign wealth fund will help boost economic development and investments in the country. BLOOMBERG