MAHARLIKA Investment Corp. (MIC) is not keen on directly investing in artificial intelligence (AI) companies, with its top official saying that the operator of the country’s sovereign wealth fund lacked the capital and expertise.
“Are we investing in AI? ... the answer is no,” President and CEO Rafael Consing Jr. told reporters last week.
“We’re not investing AI as a business. But what we’re going to do is, we are hoping that the investees would invest in AI to make themselves more efficient,” he added.
Consing said Maharlika was seeing AI primarily as a tool that investee companies could use to improve efficiency and profitability, especially now that the Philippines wants to attract major investments in AI and advanced technology through the US-led Pax Silica initiative.
The Philippines has joined the US-led Pax Silica initiative, which aims to strengthen supply chains for semiconductors, AI and critical minerals and lessen China’s dominance. The government is developing a proposed 4,000-acre industrial zone in New Clark City that will serve as an AI-native industrial acceleration hub.
Maharlika is not planning to invest in AI ventures given the difficulty of determining what part of the rapidly developing AI ecosystem would deliver the best returns, Consing said.
“There are a lot of AI stocks. You’ve got all the way from power to the chips to the delivery of the last mile,” he said.
“Do we want to be part of that? I don’t think so, because we don’t have the capacity, the capital, nor the expertise, actually, to choose which part of the stock we want to invest in.”
Consing said Maharlika could instead benefit from AI by encouraging companies in its portfolio to use the technology to improve their businesses.
While the company is in discussions with the Bases Conversion and Development Authority regarding Pax Silica, it does not expect to be a primary funding source for the initiative.
“If you look at Pax Silica, that’s going to be foreign investors coming in to build an ecosystem,” Consing said.
“Therefore, our capital itself, I don’t think it’s in fact required,” he added.
“Does our capital play any role? I don’t think it’s needed. I really don’t think it’s needed.”
He said the initiative should follow a whole-of-government approach focused on attracting foreign direct investments (FDIs).
“It’s a multi-agency, whole-of-government approach except for the capital, because we’re hoping that we can in fact attract that as an FDI,” Consing said.
The government has said the proposed New Clark City hub could attract between $40 billion and $70 billion in investments once fully developed.
It has also said the proposed project could generate more than 130,000 high-quality jobs while positioning the Philippines as a hub for advanced manufacturing.
Consing said the sovereign wealth fund can potentially help aggregate investments and support the broader investment platform while allowing foreign investors to provide much of the capital.
He also said that Maharlika was looking beyond the current administration, describing its plans as an “intergenerational strategy” that would include thematic funds covering agriculture, energy, logistics and mining.
Over time, Consing said they wanted to open these investments to the public through capital-market products.
“I would say in the next three years, we could probably have our first retail product out there,” he said.
The strategy will allow Maharlika to first deploy capital, build value in its investments and eventually create funds that could attract other investors.
