The Maharlika Investment Fund (MIF), also known as the Maharlika Wealth Fund (MWF), is a newly enacted sovereign wealth fund for the Philippines. The MIF is the Philippines' first sovereign wealth fund. It will be allocated across a variety of assets, including foreign currencies, fixed-income instruments, domestic and foreign corporate bonds, commercial real estate, and infrastructure projects.The MIF is expected to generate returns that support the government's economic goals, as outlined in the Medium-Term Fiscal Framework, the eight-point Socioeconomic Agenda, and the Philippine Development Plan.
Background
Legislative process
In late November 2022, seven lawmakers in the Philippine House of Representatives, including Martin Romualdez and Sandro Marcos, filed House Bill No. 6398, proposing the creation of a sovereign wealth fund for the Philippines to be known as the Maharlika Wealth Fund (MWF). The fund, if established, would be managed by the Maharlika Investments Corporation (MIC). President Bongbong Marcos has backed the establishment of a sovereign wealth fund, believing that it would be advantageous for the country.
After President Marcos certified the bill as urgent, it was passed on its third reading in the lower house, with 279 lawmakers voting in favor of passing the bill. Only six lawmakers voted against: Gabriel Bordado (Camarines Sur–3rd), Arlene Brosas (Gabriela), France Castro (ACT Teachers), Mujiv Hataman (Basilan–Lone), Edcel Lagman (Albay–1st), and Raoul Manuel (Kabataan). From filing to approval, it took the House of Representatives 17 days to deliberate on the bill.
On May 24, 2023, Marcos certified the creation of the Maharlika investment fund as urgent to the Senate. On May 31, 2023, the upper house had approved the third and final reading with a total of 19 senators voting in favor, one negative (Risa Hontiveros) and one abstention (Nancy Binay). It would need President Marcos' signature before it becomes law.
A bill that is certified as urgent allows lawmakers to bypass the constitutional rule requiring bills to be passed on three readings on separate days. The president's certification of urgency is typically made to respond to public calamities or emergencies. In February 2023, a petition was filed to the Supreme Court requesting to nullify Marcos's certification of urgency, arguing that it is unconstitutional because no public calamity or emergency was expressly stated in Marcos's letter to the House. This was later dismissed by the Court in May, citing that the petitioners "failed to present to Court any fact establishing the existence of an actual case or controversy ripe for adjudication".
On July 5, 2023, the copy of the bill was transmitted to Malacañang for President Marcos's signature. On July 18, he signed the bill into law as Republic Act No. 11954.
GSIS and SSS funding
Initially, the Government Service Insurance System (GSIS) and the Social Security System (SSS) were obliged to contribute funds to the MIF under the proposed bill establishing the fund. The two institutions were later dropped as mandatory contributors. However, both the boards of the GSIS and SSS would be permitted to contribute if they approve such a move.
Reception
Economist Michael Batu said the fund, if managed properly, can help raise money to help the government's programs and achieve development goals. Global Source economist Romeo Bernardo, on the other hand, believes that the proposal is poorly timed and that a sovereign wealth fund would just add to the Philippines' current financial and fiscal risks and raised concern for potential mismanagement, mentioning the 1Malaysia Development Berhad scandal.