Maharlika Fund ‘well capitalized’; can begin by December —Diokno

The planned operationalization of the Maharlika Investment Fund (MIF) is gaining traction after it secured initial capital from the Land Bank of the Philippines and Bangko Sentral ng Pilipinas (BSP).

“It is safe to say that the fund is well capitalized at the very start and we can start by the end of the year,” Finance Secretary Benjamin Diokno said during his weekly press chat.

The Finance chief said the BSP’s Monetary Board declared a dividend of P31.859 billion “in favor of the national government,” which will then be used to bankroll the MIF.

The Landbank’s Board, Diokno said, also approved its P50 billion investment in the Maharlika Investment Corporation (MIC) as mandated by Republic Act No. 11954.

With this, President Ferdinand Marcos Jr.’s chief economic manager said, "It is reasonable to expect that the Maharlika Investment Fund will be up and running before the end of 2023."

On Tuesday, Marcos signed into law the measure creating the MIF —the country’s very first sovereign wealth fund.

The law creates the MIC, a government-owned company, that will manage the MIF —a pool of funds sourced from state-run financial institutions that will be invested in high-impact projects, real estate, as well as in financial instruments.

The law mandates that the MIF would be created through the funds that will be sourced from:

• Landbank: P50 billion
• Development Bank of the Philippines (DBP): P25 billion
• National Government: P50 billion

The contribution from the national government will come from the following sources:

• BSP's total declared dividends
• National government's share from the income of PAGCOR
• Properties, real and personal identified by the DOF-Privatization and Management Office
• Other sources such as royalties and/or special assessments

Diokno also said that the MIC’s Board of Directors —composed of the Finance secretary, who will serve as the ex-officio chairperson; presidents of Landbank and DBP; two regular directors; and three independent directors from the private sector— are expected to be appointed in September. 

As the MIC is yet to be organized, Diokno said the initial capital from BSP and Landbank would be held by the Treasury in escrow.

“When the corporation is organized, that’s when the Treasury will transfer [the funds] to the corporation,” the Finance chief said.

He added that the implementing rules and regulations of the MIF law is in its final stages as the Treasury does not intend to up the 90-day period to craft the IRR.

“We expect the promulgation of the IRR to be done before the end of August,” Diokno said. —VAL, GMA Integrated News