Recto pitches Maharlika fund to Australians

MANILA, Philippines — Finance Secretary Ralph Recto encouraged Australian businesses to invest in the country’s first sovereign wealth fund, noting that the Philippines has pro-business policies in place.

In his first official international engagement as finance chief, Recto pitched the Maharlika Investment Fund (MIF) before 100 Australian business and investment leaders, as well as government officials.

“Australian investors seeking to broaden their portfolios into rapidly expanding markets such as the Philippines should explore potential ventures within the MIF,” Recto said.

“It provides an opportunity for private-sector engagement in financing our big-ticket infrastructure projects,” he said.

Recto is in Australia as part of the Philippine delegation to the ASEAN-Australia special summit.

He said there are investment opportunities, particularly in telecommunications, transportation, banking, mining and energy sectors, given the enactment of several economic liberalization laws.

For one, the amendments to the Retail Trade Liberalization Act lowered the minimum paid-up capital requirement for foreign corporations from $2.5 million to $500,000.

The changes in the Public Service Act also allowed 100 percent foreign ownership in public services while the Foreign Investments Act improved the country’s openness to foreign direct investments (FDIs) and liberalized the practice of professions.

“We are currently refining the country’s fiscal incentives system to further tailor fit incentives and attract international enterprises to invest in strategically important projects,” Recto said.

“These measures broaden investment opportunities and synergy between local and international companies, especially in cutting-edge technologies and green investments,” he said.

Complementing the medium-term fiscal framework, the DOF also put in place the Growth-Enhancing Actions and Resolutions (GEARs) plan to expand economic growth.

A key aspect of the strategy is welcoming investors with open arms to achieve investments-led growth through improvements in the regulatory regime, reduction in the cost of doing business and addressing constraints.

Recto added that the enactment of the Public-Private Partnership Code is a testament to the administration’s commitment to fostering stronger collaboration with the private sector.

“We have taken great care to ensure the economic returns on our major projects, choose the most highly concessional financing available and diversify our sources of project funding,” Recto said.

Australia was the Philippines’ 13th biggest trading partner with total trade valued at $4.1 billion in 2023, up 20.6 percent from 2022.

Australia also stands as the 16th largest contributor of net FDIs, totaling $5.7 million as of end-November 2023.