MANILA – Philippine President Ferdinand Marcos Jr has suspended the implementation of a controversial sovereign wealth fund that he fought to bring to fruition, citing the need to make it foolproof.
His executive secretary said in an Oct. 12 memo there was a need to study the fund’s implementing rules and regulation, which were already in effect, to ensure that safeguards were in place for “transparency and accountability.”
The factors cited for the suspension were the very same reasons that critics of the fund have cited when they opposed it, which were met by repeated assurances from its backers, including Mr. Marcos, the fund would be managed with prudence.
It was not clear from the memo for how long the rules would remain suspended.
Opposition lawmaker France Castro said on Wednesday the suspension of the fund’s implementation showed the measure was “rushed and flawed in so many levels.”
“It would be better if President Marcos Jr. just scrapped the whole Maharlika law rather than just suspend it,” Mr. Castro said in a statement. “We don’t have excess fund for this.”
The government has envisaged the fund would issue a total of P500 billion ($8.81 billion) worth of preferred and common shares which the national government, state-run firms and banks can purchase.
A shortlist of candidates for the board of directors to help manage the fund was submitted to Mr. Marcos this month.
Mr. Marcos, in signing the bill creating the fund in July, touted it as a key plank of his economic goals to modernise infrastructure and accelerate the country’s growth.
It followed moves by neighbours Malaysia and Singapore and more recently Indonesia in establishing sovereign wealth funds, albeit with mixed results.
In Malaysia, a multi-billion dollar graft scandal engulfed the 1Malaysia Development Berhad (1MDB) fund, causing widespread political repercussions. — Reuters