Speaker Ferdinand Martin G. Romualdez on Wednesday morning (Switzerland time) told foreign investors that now is the most opportune time to invest in the Philippines, especially through the country's sovereign wealth fund, also known as the Maharlika Investment Fund.
Romualdez made the pitch during the "Breakfast Interaction with the Philippine Delegation to the 2024 World Economic Forum" (WEF) roundtable discussion attended by executives and top-level representatives from leading international business and interest groups held Wednesday morning at the Belvedere Hotel in Davos, Switzerland.
In his welcome remarks during the event, Romualdez cited the robust growth of the country's economy under the visionary leadership of President Ferdinand R. Marcos, Jr., continuing reforms to make the country more investor-friendly, as well as the positive prospects of the newly-established MIF.
"I am heartened and thankful for the interest we have received from both local and foreign investors who have recognized this as the most opportune time to invest in the MIF," said Romualdez, head of the Philippine delegation to the 2024 WEF annual meet.
"We are extremely optimistic in the continued growth of the Philippine economy and the potential of the MIF and look forward to a fruitful partnership with our investors as we build a better, brighter future for our countrymen," he added.
Romualdez acknowledged that like the rest of the world, the Philippines has experienced challenges in the previous years, principally caused by the coronavirus pandemic that hit local industries hard.
"However, we are indeed quite fortunate to have a President determined to revive the country’s economy. In the past two years I have seen him assemble a team of highly competent technocrats and civil servants, earn the confidence of the business community, and continue to engage relevant stakeholders to achieve economic growth, and the agenda for prosperity," Romualdez said.
As a result of such efforts, Romualdez noted that the country has seen its GDP expand by 5.9% in the third quarter of 2023, with GDP growth forecasts for the fourth quarter pegged at 6.2%.
"There is much promise that beyond the country’s economic recovery, there is also room for tremendous growth. We have been looking at ways of sustaining this momentum, and one of the key factors lies in finding innovative solutions and improving existing ideas to address long-standing issues," Romualdez said.
"One of these solutions, developed by the country’s legislative and executive branches, is the establishment of its first-ever sovereign wealth fund. Called the Maharlika Investment Fund, or the MIF, it is envisioned as an investment vehicle for government programs and projects aimed at promoting the country’s growth and social development," Romualdez said.
Created through legislation in 2023, the MIF will be sourced from both the public and private sectors, locally and internationally. Foreign and domestic capital will be co-investors to finance the country’s economic development, mainly through investments in commercially viable projects.
He added that the fund will make strategic and profitable investments in key sectors, to obtain optimal returns and financial gain in these investments. Several potential sectors have been identified, including infrastructure, oil, gas, and power, mineral processing, tourism, transportation, and aviation.
"With the government’s full support, the MIF will be stable, profitable, and economically sound. As the President has said, it will be “run professionally and without undue political influence." Skilled, experienced managers will handle the operations to preserve and enhance the value of the fund, with auditing mechanisms and financial safeguards in place," Romualdez said.
He pointed out that being a former banker himself, he has seen over 70 countries establish their versions of sovereign wealth funds, with over 90% success rate.
"We hope to integrate the best practices of these nations with SWFs while remaining responsive to our country’s development needs," Romualdez said.
Romualdez added that the Philippine Senate and the House Representatives are now in sync in efforts to introduce constitutional reforms to create a framework that will be conducive to fostering a competitive, inclusive, and robust economic environment.
"These reforms, one of which is to allow more flexibility on the entry of foreign direct investments in the country, provide long-term economic viability for many of our industries and will enable us to better adapt to the ever-evolving global landscape. Said reforms are not just timely but also long overdue, and I am honored to witness this process unfold," Romualdez said.
The breakfast gathering provided a venue for the PH delegation to the 2024 WEF to present investment opportunities in the Philippines, explain the features of the MIF, and answer concerns raised by the guests.
Among the key issues discussed during the breakfast meeting include concerns about the stability and predictability of policies, the challenge and potential of digitalization, as well as the critical role in the progress and development of reliable energy supply.
In answering the queries of the guests, Romualdez was supported by Maharlika Investment Corporation CEO and President Rafael Consing, Jr., Energy Secretary Raphael Lotilla, Bangko Sentral ng Pilipinas Governor Eli Remolona, Permanent Representative to the World Trade Organization Ambassador Manuel AJ Teehankee, Philippine Ambassador to Switzerland Bernard Faustino Dy, and BSP Deputy Governor Berna Romulo-Puyat.