It has been months since leaders of the House of Representatives first floated the idea of a sovereign wealth fund for the Philippines. They called it the Maharlika Investment Fund (MIF) a.k.a. a pool of money from government assets to be used for investments (infrastructures, corporate bonds, real estate, etc.). Fast forward to May 31, and the Senate approves the bill, causing an uproar online. Why exactly are Pinoys not in favor of the MIF? Atty. Chel Diokno’s take on the issue might help you understand.

Atty. Chel Diokno is not in favor of the Maharlika Investment Fund

1/8 Like so many fake things going around these days, the Maharlika Investment Fund (MIF) is full of false pretenses. It pretends to be a sovereign wealth fund but it is not.👎🇵🇭

— Chel Diokno (@ChelDiokno) June 1, 2023

“Like so many fake things going around these days, the Maharlika Investment Fund (MIF) is full of false pretenses. It pretends to be a sovereign wealth fund but it is not,” Diokno starts his Twitter thread strong.

He goes on to explain that sovereign wealth funds (SWF) are only possible if a country has excess money that they can allocate for investments. This is how countries like Singapore, South Korea, and Hong Kong financed their SWFs. However, the Philippines currently owes a P13.42 trillion national debt which means we have no reserve funds to start the MIF.

So what do we use, then?

3/8 So, what’s used isn’t surplus—since we have none—but the core funds of government banks and other government corporations designated for various purposes according to their charter. From the start, this proposed bill is suspicious.

— Chel Diokno (@ChelDiokno) June 1, 2023

According to the MIF bill, it will use money from Bangko Sentral ng Pilipinas (100% of dividends) plus other government financial institutions (GFIs) like Land Bank of the Philippines (₱50 billion) and the Development Bank of the Philippines (₱25 billion).

“From the start, this proposed bill is suspicious,” continues Diokno.

Initially, the proposal also indicated sourcing funds from the Government Service Insurance System (GSIS) and the Social Security System (SSS) which caused a public outcry.

However, on May 31, news outlets reported that the Senate accepted Sen. Raffy Tulfo amendment “prohibiting GSIS, SSS, PhilHealth, PAGIBIG, OWWA fund, PVAO fund from investing in the MIF.”

Is this the right way?

5/8 …and handing it over to those appointed by the President to the MIC. The MIF, according to its proponents, will promote socio-economic development. But is this the right way? 🤔

— Chel Diokno (@ChelDiokno) June 1, 2023

Diokno explains that once the MIF is signed into law, the Maharlika Investment Corporation (MIC) will have full control of over P500 billion in funds. The MIC initially had President Ferdinand Marcos Jr. as its chairman, but this was later revised to the Secretary of Finance Benjamin Diokno, who is also the current governor of BSP.

Chel Diokno asks: Do we really need the Maharlika Investment Fund?

6/8 Will creating a new entity to manage funds that are already being managed by existing agencies promote the people’s socio-economic development—or become a magnet for corruption?

— Chel Diokno (@ChelDiokno) June 1, 2023

Diokno then questioned the practicality of the Maharlika Investment Fund. Why reallocate money from existing agencies when the country is already in debt?

“Will creating a new entity to manage funds that are already being managed by existing agencies promote the people’s socio-economic development—or become a magnet for corruption?” he asks, echoing the concerns of Filipinos.

Diokno is also worried that the MIC could be a hotspot for corrupt individuals who, if appointed, will be “guaranteed benefits in terms of salary and power.”

Transparency is key

8/8 Transparency is key to ensuring that this doesn’t just turn into another vehicle for corruption and personal gain. Our focus should always be on the betterment of the Filipino people. Let’s stay vigilant!

— Chel Diokno (@ChelDiokno) June 1, 2023

Diokno ends his short Twitter thread by reminding everyone that “transparency is key to ensuring that this doesn’t just turn into another vehicle for corruption and personal gain.”

“Our focus should always be on the betterment of the Filipino people. Let’s stay vigilant!” he adds.

How senators voted on the Maharlika Investment Fund bill

With a vote of 19-1-1, the Senate swiftly passed the controversial bill to create the Maharlika Investment Fund on Wednesday, May 31. Here’s how the 24 senators voted on the measure. https://t.co/7Nt3djuogX pic.twitter.com/AeauPuvUJa

— Rappler (@rapplerdotcom) May 31, 2023

Last May 31, a total of 19 senators approved the Maharlika Investment Fund bill while only Sen. Risa Hontiveros objected to it. Sen. Nancy Binay abstained from voting and Senators Imee Marcos, Koko Pimentel, and Chiz Escudero were absent.

Check us out on Facebook, Instagram, Twitter, TikTok, and YouTube, to be the first to know about the latest news and coolest trends!