The Maharlika Investment Fund (MIF) is seen to contribute at least 0.07 percentage point (ppt) to the economy’s annual growth in the first decade of its operations, according to the Department of Finance (DOF).
The DOF, in a fact sheet distributed to reporters late Friday, cited a study conducted by the National Economic and Development Authority (NEDA) on the MIF.
According to that report, when the full P125 billion initial capitalization has been fully paid over the first 10 years of operations, the MIF can generate a 0.07 ppt contribution to Philippine growth annually over the same period.
It is also projected to produce 100,000 direct and indirect jobs and due to spillover effects, the value added generated through investment activities in the first 10 years of the Fund is expected to still contribute 0.01 ppt annually to growth over the succeeding decade.
In contrast, NEDA also projected returns in a scenario where there is no MIF, and the P125 billion used for the initial capitalization remains with the founding government financial institutions and the national government: the P125 billion is projected to contribute 0.06 ppt to the country’s growth, and there are no spillover effects expected in this scenario.
Meanwhile, in another scenario where, in addition to co-investments generated with other parties, the P500 billion authorized capital stock of the Maharlika Investment Corp. can be fully paid over the course of the first 10 years of operation, the MIF is seen to generate a 0.22 ppt contribution to Philippine growth annually.
Job creation, both direct and indirect, is projected at 350,000 employment, while the spillover effects in this scenario are expected to contribute 0.05 ppt annually to growth over the next 11 to 20 years.
The MIF is also projected to accelerate the implementation of the 197 NEDA-approved infrastructure projects, 39 of which shall be financed through Public- Private Partnership.
In particular, the DOF said the Fund can look into big-ticket infrastructure, such as in green and blue projects, countryside development and other employment-generating projects.
Key examples cited include public road networks, tollways, green energy, water, agro-industrial ventures and telecommunications.
“A fully operational MIF, coupled with an ideal economic back drop to attract more investors will definitely be major factors that will increase job creation in the country, consequently accelerating the Philippines’ economic growth,” the DOF said.
“This can also contribute further to building trust between stakeholders, including institutional investors, civil society, and the private sector. Specifically, the MIF is envisioned to target certain areas that improve the private sector’s confidence in stakeholders,” it added.
