On the sidelines of the WEF in Switzerland, Marcos met with Gokul Laroia, chairman for Asia Pacific of Morgan Stanley. Laroia informed Marcos that they will be setting up an office in Manila and promised to back the government’s development initiatives.
Morgan Stanley is an American multinational investment management and financial services company headquartered in Midtown Manhattan, New York City.
It is a global leader in investment banking and has been advising clients on transactions, including mergers, acquisitions, restructurings, initial public offerings (IPOs), convertibles, share repurchases, debt offerings, and derivatives, among other services.
Laroia said the Marcos administration is on the right track in involving the private sector in its plans especially for the betterment of the infrastructure in the Philippines, noting that when issues on government policy are addressed, private sector participation automatically happens, particularly by raising capital.
“Because you know there’s a lot to work with in the Philippines, as you said, the supply side dynamics need to improve,” the Morgan Stanley official said.
“We’re seeing some evidence of diversification of supply chains, the need to have the infrastructure benefit from that. So all of these can be a vicious cycle,” he added.
Marcos told Laroia that another area the government is looking into to develop is the so-called environmental funding or climate change funding.
“We’re excited to be a part of it, and we’re spending time there, we’re opening an office there, we’re trying to work with– both the government but also the private sector. And we will be supporters and we will continue to be,” said Laroia.
Laroia said they also find the proposed sovereign fund of the Philippines interesting because a lot of the infrastructure investments will be carried out in the long term.
In a breakfast meeting with top international chief executive officers (CEOs) on the sidelines of WEF, Marcos maintained that setting up a Philippine sovereign wealth fund is a “good idea” to leverage government assets and pursue big-ticket infrastructure projects, particularly in energy and agriculture, as well as digitalization.
“When we first discussed the sovereign wealth fund, the real purpose is that there is not enough money in government to do all the things that we need to do,” Marcos said.
“We have reserves. And we must make [sure] that money sitting in banks, commercial and government… we need to find a way to make that money work for us, and that’s why we thought the sovereign wealth fund would be a good idea to leverage what assets the government has, what monies the government has,” he added.
Marcos said the sovereign fund will encourage private sectors to partner with the government, noting its crucial role in national growth and development.
The President assured that with the professionals managing the fund, it will be efficient in driving strategically important investments to the country.
“The management of the wealth fund must be seen to be rational, sober, professional… we will certainly make sure that anyone who will look at the fund will see that it is run professionally and properly. In that way, the wealth fund has a good future to be able, as I said, to succeed in doing what we want to do, which is leveraging what we have for these big-ticket investments,” Marcos said.
House Bill 6398, which seeks the establishment of the Maharlika Wealth Fund, was introduced by House speaker Martin Romualdez, Marcos’ cousin, in November 2022.
Initially, under the proposed measure, the funds, which will be invested in real estate and financial assets, will be sourced from primarily from contributions from the Government Service Insurance System (GSIS), Social Security System (SSS), Land Bank of the Philippines (Land Bank), and Development Bank of the Philippines (DBP).
It was later decided to no longer compel GSIS and SSS to serve as mandatory contributors to the funds amid concern raised by pensioners.
Marcos admitted being the one who brought it up in order for the country to have additional sources of investment as he certified the bill as urgent.
The bill was approved on third and final reading by the House of Representatives on December 15, 2022 and was transmitted to the Senate on December 19, 2022. (SunStar Philippines)