SENATOR Mark Villar, chairperson of the Committee on Banks, Financial Institutions and Currencies, raised the question as to whether the proposed Maharlika Fund will “overlap” or compete with the mission assigned to the National Development Company (NDC), the state-owned enterprise investing in diverse industries.

Villar led the scrutiny of measures seeking to establish the country’s sovereign wealth fund Monday, February 27, 2023.

During the third public hearing on House Bill (HB) No. 6608 and Senate Bill (SB) Nos. 1670 and 1814, Villar sought the opinion of the National Development Company (NDC) on how the creation of the Maharlika Investment Fund would affect their operations.

NDC General Manager Antonilo Mauricio told the committee that the NDC does not have a position on the creation of the Maharlika Fund since the agency is not involved from the start in the conceptualization of the proposed sovereign wealth fund.

However, Mauricio suggested to senators “to give emphasis on NDC as an investment arm.”

Sen. Nancy Binay, for her part, raised a similar question saying that the Maharlika Investment Corporation (MIC), the corporate body envisioned to handle the Maharlika Investment Fund (MIF), just might be a competition to future investment deals of the government.

“Wouldn’t the MIC be a competition to the NDC? Because, for example, why would I give my money to you when I can invest it in the MIC where it will be tax-free and would have more incentives?” she asked.

NDC General Manager Antonilo Mauricio said that the NDC is focused on smaller deals and investment gaps that national government agencies might have overlooked.

Atty. Rogelio Quevedo, Government Corporate Counsel of the Office of the Government Corporate, also explained that while the NDC will be focusing its investments on local development projects, the MIC will invest in treasury bonds, equities, and government securities.

Sen. Sherwin Gatchalian sought clarification from government financial managers on the representation of private investors in the creation of the Maharlika Investment Fund.

Gatchalian said the absence of private sector representation in the Maharlika Investment Corporation – the proposed manager of the sovereign wealth fund – will not entice private businesses to contribute to the Maharlika Fund.

“Will private equity be attracted to that?” Gatchalian asked.

“They are very particular at representation at the board obviously to protect their investments,” he noted.

National Treasurer Rosalia De Leon said they are looking at limiting the participation of private contributors to prevent them from having majority control over the Maharlika Fund.