Philippines Completes Sovereign Wealth Fund Rules

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Philippines’ Inaugural Sovereign Wealth Fund

The Philippines is gearing up to establish its first sovereign wealth fund, known as the Maharlika Investment Fund (MIF). President Ferdinand Marcos Jr recently confirmed that the government has finalized the rules for the fund’s operation, with a focus on ensuring transparency and accountability.

Swift Implementation on the Horizon

Following the approval of the fund’s rules, the government aims to rapidly put the corporate structure in place to kickstart MIF operations. The target is to have the fund up and running by the end of the year, indicating the urgency and importance attached to this economic initiative.

Driving Economic Growth and Infrastructure Development

The Philippines considers the Maharlika Investment Fund a pivotal component in its strategy to foster economic growth and advance infrastructure projects. Forecasts anticipate that establishing the fund will significantly enhance the country’s financial capabilities for development.

Fund Structure and Share Issuance

According to the law governing the MIF, the fund will issue both preferred and common shares, collectively valued at 500 billion pesos (approximately S$12.09 billion). These shares will be available for purchase by the government, state-run firms, and banks.

Catch-Up in the Region

While the Philippines has been a latecomer to the creation of its sovereign wealth fund in comparison to some of its neighbors, such as Indonesia, which launched its fund in 2021, and Singapore, which has long maintained an established fund, the nation’s commitment to this financial instrument highlights its dedication to economic growth and stability.

The fund’s establishment represents a key plank in the nation’s strategy, and its successful implementation is anticipated to significantly bolster the country’s financial capabilities for development, ensuring a more prosperous future for the Philippines.

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