Sovereign wealth fund a magnet for investments

(UPDATE) ABOARD THE PHILIPPINE PRESIDENTIAL PLANE: President Ferdinand “Bongbong” Marcos Jr. will tell the world the Philippines “is forming a sovereign wealth fund for big investments” when he joins global leaders and top chief executive officers at the World Economic Forum (WEF) in Davos, Switzerland, this week.

Speaking to reporters accompanying him to Switzerland, Marcos said he will pitch the Philippines as an “investment destination” during the forum.

He said he is looking at attracting big investments in agriculture, energy, digitalization and climate change through the proposed Maharlika Wealth Fund or MWF.

The proposal faced some pushback, with critics questioning the need for a sovereign wealth fund, given the government’s budget deficit and record debt.

Marcos said the Davos forum will “give us a better opportunity to expand and expound on the things that we are doing in the Philippines.”

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The President said he is also eyeing “best deals” from other businessmen on the sidelines of the forum.

While in Switzerland, Marcos will also meet with business leaders and members of the Filipino community.

During a public briefing Monday, economist Michael Batu said Marcos’ participation in the forum is the “best opportunity” to pick the minds of his fellow leaders and gain feedback.

It will also help fine-tune the proposed measure for the MWF, Batu said.

House Bill 6608 or the “Maharlika Investment Fund Act,” was approved on third and final reading by the House of Representatives on December 15.

It was transmitted to the Senate four days later.

Batu said the forum will also serve as a good follow-up to the meetings Marcos had with European Union officials and business leaders in Brussels, Belgium late last year.

“Mahalaga na i-showcase ng ating Pangulo iyong ating macroeconomic fundamentals lalo na sa panahon ngayon na globally ay mayroong inflation, may mga headwinds ‘no. Globally, nandiyan iyong pagtaas ng presyo ng langis nitong mga nakaraang buwan. So, kabila nitong mga headwinds na ito ay nanatiling matatag po at resilient iyong ating economy (It is important for the President to showcase our macroeconomic fundamentals especially at this time that there is inflation globally, there are headwinds. Globally, there’s been rising prices of fuel these past months. So, despite these headwinds our economy remains resilient),” he said.

The President also told the reporters he is confident the country’s inflation “will come down” for the rest of the year as his administration steps up efforts to stabilize prices and the supply of agricultural commodities.

“The most important facet of this whole problem is production. We have to go back to the sugar industry. We have to go back to the onion growers and help them para magkaroon tayo ng production, hindi na tayo kailangan mag-import (so that we’ll have our production, we will no longer forced to import),” said Marcos, who is also Agriculture secretary.

“Diyan tayo naipit eh. Nasanay tayo masyado sa import. So import lang tayo nang import hindi natin inaayos ‘yung production side. Kaya nung tinamaan tayo ng pandemya, ramdam na ramdam natin (That’s where we were in a bind. We’re really used to import. So we always import and import and we neglected the production side. That’s why when the pandemic hit us, we’re really affected),” he said.

Last November, inflation raced to a 14-year high of 8 percent. Government economists and multilateral lending institutions expect inflation to remain high in 2023.

The President said the government was forced to import to address the rising prices of agricultural products.

“I’ll be very candid with you. Ang hirap malaman kasi depende kung sinong kausap mo (It’s really hard to predict because it depends on who you talk to) whether or not we need to import. May nagsasabi, onion hindi kailangan mag-import. Papaano naman hindi tayo kailangan mag-import (There are some who said that we don’t need to import onions. How come we don’t need to import)?” Marcos said.

Marcos said the government also did the same thing to increase the supply of sugar, but “we did it a slightly different way.”

“We will maintain from now on in sugar a two-month buffer stock para hindi na magkaroon ng masyadong speculation sa presyo ng sugar (so that there will be no speculation on the prices of sugar). So that people will know hindi tayo magkaka-shortage dahil lagi tayong mayroon two-month na buffer stock (that we will not experience shortage because we always have two-month buffer stock) which I will maintain,” he said.

Asked if he had plans to appoint a full-time Agriculture secretary, Marcos said, “When this is fixed, when we have the systems in place, yes, yes.”

He said the government is also working hard to solve the “rampant” smuggling in the country.

Speaker Martin Romualdez on Monday said he is confident that the President can articulate the administration’s gains, introduce the MWF and promote the Philippines as an investment hub at the World Economic Forum.

“In his previous participation in various global fora, President Marcos has displayed an excellent ability to articulate the interests of the Philippines as well as the significant gains achieved under his administration and the country’s direction for future growth,” Romualdez said.

“I’m confident he would do the same in the WEF, particularly in introducing the Maharlika Wealth Fund to the global stage and in helping our local business leaders explore investment opportunities for the Philippines,” he said.

Romualdez is part of Marcos’s official delegation to the WEF.

“The proposed sovereign wealth fund will help President Ferdinand Marcos Jr. keep the country on the high-growth path. We want to assure the public that the management of the fund will follow best practices and the principles of transparency and accountability,” he said.