SENATE President Juan Miguel Zubiri yesterday said Congress will exercise its oversight functions and review future or ongoing infrastructure projects where the government will invest the Maharlika Investment Fund (MIF) seed money to ensure that the sovereign funds are spent on worthwhile projects.
In an interview with CNN Philippines, Zubiri said Republic Act (RA) 11954, or the MIF law, has a provision that requires the creation of an oversight committee to keep an eye on the venture capitals to be approved by the Maharlika Investment Corporation (MIC), the company that will manage the sovereign funds.
The oversight committee will be composed of select members of the Senate and the House of Representatives.
“We will review the projects that are planned to be implemented or even review projects that have been started or (are already) ongoing,” Zubiri said.
This early, the Senate leader called on MIC Board Members to properly vet where to invest the sovereign fund and not use it to finance “high risk” projects.
“I wouldn’t think that they would put the fund in the stock market. With due respect to the stock market, I think the stock exchange right now is in morbid state, it is not moving.
There are no investors,” Zubiri said.
He said MIF managers could instead partner with private corporations in putting up infrastructure projects so that the government would only spend a small portion of the MIF seed money.
“Puwede naman kasing PPP ‘yan (It can be PPP [private public partnerships]). They have to partner with other companies. Ilagay nila ‘yan sa mga proyekto(Invest in projects) in partnership with (the) private sector… concrete projects that are going to have a high impact for the economy and, of course with steady returns for the Maharlika Investment Fund,” he added.
Planning Secretary and National Economic and Development Authority (NEDA) head Arsenio Balisacan said “any of these 194 (NEDA-approved flagship) projects can be an investment project for the Maharlika fund.”
The decision, he said, would depend on the MIC board.
“There are many of those projects that are quite viable, financially attractive for Maharlika.
For example, we mentioned these airports… those are very productive, profitable projects, and that’s where we expect a number of bidders to come in. But railways, expressways, especially maintenance and operation of such projects could be also attractive… We have many of those in that list of priority projects,” Balisacan said.
At the same time, Balisacan assured the public that the establishment of the MIF would neither compromise next year’s budget nor add to the country’s debt.
Balisacan made the assurance amid concerns and criticisms raised by some sectors after President Marcos signed RA into law on Tuesday.
He said the MIF will not be funded by the proposed the P5.3 trillion budget for 2024 but will instead use the “funds that are not, you know, used” by the Land Bank and the Development Bank of the Philippines, along with remittances from the Bangko Sentral ng Pilipinas (BSP).
Balisacan also said the MIF will not raise the national debt since it will use “idle funds.”
“No, it will not happen by design because the funds that we are putting in there are, you know, idle funds, not funds that are being utilized. And what the Fund is trying to do is to put those into more productive, higher yielding instruments so that you can earn more from those funds. The other objective is to get co-investors, the investment community to invest into the projects supported by the Fund so that the Fund could grow bigger and could support more projects,” he added.
Under RA 11954, government financing institutions will pool together non-debt financial resources and invest it in a wide range of investments projects that would generate bigger returns such as foreign currencies, fixed-income instruments, domestic and foreign corporate bonds, joint ventures, mergers and acquisitions, real estate and high-impact infrastructure projects, and projects that contribute to the attainment of sustainable development.
It may also be tapped to finance public and flagship infrastructure projects. — With Jocelyn Montemayor
