Rightly or wrongly, the Maharlika Investment Fund (MIF) was speedily enacted — a constitutional infirmity that can be remedied by possible legislation should the Supreme Court find it flawed.
Discarding it now could bring negative repercussions to the country. The argument that the MIF jeopardizes the stability of government banks — Land Bank, Development Bank of the Philippines, and the Bangko Sentral — is premature and speculative, because the returns on investments would have been realized with viable investments in FDI or foreign direct investments.
With the signed agreement with Saudi Arabia on $4.3 billion FDIs, there are more optimistic reasons to continue with the MIF, but with better internal rules and regulations.
First, the joint $4.3 billion projects with Saudi Arabia augur well for the long-awaited development of Mindanao’s vast resources and the employment of up to 50,000 workers. The domestic ownership counterpart that might need MIF funding will meanwhile increase demand on domestic trade since the enhanced spending would stir up business for our moribund micro, small, and medium enterprises that make up 99.5 percent of domestic trade.
Secondly, the treasury department is on track to generate domestic interest in investments made by individual Filipinos with its offer of attractive short-term bond rates. The expected funds generated of up to P200 billion monthly would be instrumental in reducing the proportion of our outside debt to 20 percent of total government obligations. As MIF placement, these funds can help local investors in partnering with FDIs, with expected fair returns.
With the government showing better fiscal management of its budget and directing attention to bringing in foreign investors via an assurance of stable rules and the long-term security of their investments in the country, the MIF is a hopeful development for us.
MARVEL K. TAN
marvelktan@yahoo.com