National Treasurer Says That Maharlika Fund Can Ease PH Borrowings

According to National Treasurer Rosalia V. de Leon, the Maharlika Investment Fund (MIF) can lessen the need for foreign debt to be used for development.

During the first Senate hearing on the MIF, De Leon mentioned that the MIF will pool together investible funds from financial institutions and agencies of government and can be used to bring in the private sector.

The said pooled funds can then be used to fund infrastructure projects, instead of the government borrowing money from other countries.

Replying to queries from Senators, De Leon then cited other examples of sovereign wealth funds which were able to generate other investments.

She then mentions that the government’s financial managers predict that “there will be even more funding in terms of the equity that will come in.”

“Eventually, that reduces the fiscal pressure on the budget” she adds.

However, De Leon stated that they cannot maintain definite commitments from investors, “because we don’t have the legislation yet” and thus can only provide draft legislation.

When asked about the MIF impact on the government’s target of lessening the debt-to-GDP ratio, De Leon stated that “this can ease the burden, as it will reduce our need to borrow.”

The MIF is proposed to have an initial capital worth ₱50 billion from the Land Bank of the Philippines (Landbank) and ₱25 billion from the Development Bank of the Philippines (DBP). De Leon mentions that this would be a small portion of the ₱1.3 trillion investible funds of LandBank and ₱800 billion of the DBP.

Source: Business Mirror