GSIS invests in Macquarie Asia Infrastructure Fund

MANILA, Philippines — State-run Government Service Insurance System (GSIS) is set to invest in the $3.3 billion Macquarie Asia Infrastructure Fund (MAIF2), a private fund vehicle intended to finance infrastructure projects in Asia.

In a phone interview, GSIS president and general manager Jesus Clint Aranas said the state pension fund has participated in the Asian regional infrastructure fund as part of its efforts to diversify its investments and seek higher returns.

“We don’t want to put everything in Philippine investments because we’re saturated here. So we are trying to diversify our asset investments,” Aranas told The STAR.

However, Aranas declined to provide the specific amount of investment committed by the GSIS to the infrastructure fund.

The $3.3 billion MAIF2 is managed by the Macquarie Infrastructure and Real Assets. In an earlier press statement, Macquarie said more than $1.7 billion of its capital has already been committed across toll roads, renewables and petrochemical storage assets in India, the Philippines, Singapore and China.

Its predecessor fund, the MAIF1, was fully deployed across seven countries in the Asia-Pacific.

In 2012, GSIS also partnered with the Asian Development Bank (ADB), Dutch pension fund managers Algemene Pensione Groep (APG), and the Macquarie Group to set up the $625 million Philippine Investment Alliance for Infrastructure (PINAI) fund to finance infrastructure projects in the Philippines.

GSIS allocated $400 million for the program. As of end-December 2017, Aranas said the fund is almost fully deployed.

Aranas said the GSIS’ participation in the fund was able to yield returns of more than 13 percent for the state fund as of end-2017.

“The greater returns that this fund is generating helps GSIS to lengthen its actuarial life (currently at 35 years or until 2051) that will enable us to fulfill our current and future obligations to our members and pensioners,” Aranas said.

Among the investments made under the investment alliance fund include the North Luzon Renewable Energy Corp. Wind Farm in Ilocos Norte, Negros Island Solar Power project in Negros Occidental, GN Power Kauswagan coal fire power plant in Lanao del Norte, and a 45-megawatt solar power project in San Carlos City, Negros Occidental.

GSIS also invested in coastal storage facilities in the Subic Bay Freeport Zone, as well as the operation and maintenance of the existing 20-kilometer LRT Line 1 and the construction of a 12-kilometer extension of the train to Cavite.

Aside from participating in MAIF2, Aranas earlier said the GSIS is seeking to diversify its investments by increasing the share of its overseas investments.