[EDITORIAL] Wrong Move

Knowing that the Philippines is suffering from a lack of budget, rising inflation, and debt, President Ferdinand Marcos Jr. signed the controversial first Sovereign Wealth Fund of the Philippines, the Maharlika Investment Fund (MIF) bill into law last July 18, 2023. The Marcos administration’s economic team admitted that the government was in a “hurry” to implement the law. Did the government make the right move and can they invest people’s money without losses?

The Maharlika Investment Fund aims to generate profits that will skyrocket our economy and fund government projects. Commonly, Sovereign Wealth Funds are funded with people’s money, and the surplus revenues of the government. Marcos signed the MIF bill into law knowing that a lot of economists, opposition lawmakers, business groups, and other social groups are against it. The money that will be funded to MIF is from the people, the dividends of the Bank of the Philippines (P50 Billion), Landbank of the Philippines (P50 Billion), and Development Bank of the Philippines (P25 Billion).

It is true that investing will generate a huge amount of money. However, investing is not all about making profits. It is also likely to lose more than we can gain. The Philippines cannot afford any losses at the moment as there had been a lot of projects to fund. In addition, the Philippine economy is still recovering from the effects of the pandemic. Most importantly, the national government’s debt rose to P13.70 Trillion by the end of March 2023 said the Bureau of the Treasury.

Furthermore, there is a proposed budget of P5.768 trillion 2024 national budget, however, almost P294.1 billion is unfunded. “Since we have a fiscal deficit, may we know where the government is going to source its subscription of P50 billion to the Maharlika Investment Corporation?” asked Edcel Lagaman — opposition lawmaker and Albay 1st District Rep. Why would the government be in a “hurry” to implement a major project knowing this?

Looking at the situation of the sectors in the Philippines such as the Department of Agriculture and the Department of Education, they certainly needed funds and prioritization. Most of the farmers find it hard to farm as supplies and tools for farming are expensive but their products sell for a very cheap price, unable to gain profits. In the Department of Education, most teachers and staffs are overworked but underpaid. There are not enough school facilities and equipment that are essential for the students to efficiently and effectively learn. The Philippine educational outcomes are also declining.

We are warned by Malaysian Prime Minister Anwar Ibrahim that the government should be careful about this investment fund because they have a similar investment fund called 1Malaysia Development Bank (1MDB) that became a scandal where politicians wired money from this investment fund to their own pockets. Note, how can this investment plan not be a source of corruption when the man who signed this law in a “hurry” is the son of a dictator and corrupt politician?

The Government is biting more than they can chew. Knowing these issues, the government is still prioritizing this risky project that can certainly lose millions or billions of people’s money. Why would they make a business out of people’s money in the first place? It is truly a wrong move and bad timing to be implementing this investment fund now. The Government should not prioritize this investment fund at the moment. They should first ensure that it would not matter if we make huge losses.

The government made a wrong move in implementing the MIF law at this time in the Philippines. There is an abundance of issues that needs the prioritization of the government more than the MIF has. As this is already implemented and approved we can only hope that the result of this project are as great as what the President promised.