Millennium Challenge Corp. Vice President for Operations Kamran Khan.
WASHINGTON, DC— The Aquino administration’s strong reform efforts, including its popular campaign against corruption, have made the Philippines eligible again for significant poverty reduction funding from the United States.
The Philippines’ eligibility for a new five-year grant or compact was announced December 11 by the Millennium Challenge Corporation (MCC), an independent American aid agency created by the US Congress in 2004.
The announcement came four years after it awarded the Philippines $434-million to fund three major poverty reduction projects.
“The selection of the Philippines for a subsequent compact recognizes the significant progress achieved under the current compact and its strong efforts at policy reform, including successful efforts to root out corruption,” the MCC said in a statement issued on Thursday.
“It is a recognition of President Aquino’s commitment to good governance,” Ambassador Jose L. Cuisia, Jr. said. “I believe a smooth transition to a second compact will help the Philippines in further institutionalizing good governance policies and reforms.”
Cuisia said MCC Vice President for Operations Kamran Khan informed him of the approval by the MCC Board. He then reported the good news to Foreign Affairs Secretary Albert del Rosario and Finance Secretary Cesar Purisima.
Approved in 2010, the first compact provided the Philippines with $214.4 million for the construction and repair of 220 kilometers of Samar roads to improve access to markets and services for farmers, fishermen and small businessmen; $120 million for a development project that empowers communities by encouraging their participation in poverty reducing activities; and $54.3 million for the computerization and streamlining of business processes of the Bureau of Internal Revenue to bolster tax collection and reduce corruption.
Cuisia said Manila’s eligibility for a second compact was greatly enhanced after the recent release of the latest MCC scorecard where the country passed 13 out of 20 indicators, including Immunization Rates, Land Rights Access, Rule of Law, and the “must-pass” indicator Control of Corruption.
Rule of Law and Control of Corruption are based on the World Governance Indicators (WGI) where the Philippines recently improved its ranking. Several individual indicators such as the Global Integrity Index, the Transparency International Global Corruption Barometer Survey, the World Justice Project and Freedom House are used to construct the WGI indicators.
“I echo our economic managers’ sentiments that this indeed will heighten the confidence level in the Philippines and complement the gains in the economic front,” he added.
Aside from the Philippines, the MCC selected Mongolia as eligible for a new compact and approved efforts to continue developing compacts with Benin, Lesotho, Liberia, Morocco, Niger and Tanzania. The MCC also voted to make Nepal eligible for a compact; selected Cote d’Ivoire and Sierra Leone to develop Threshold Programs; and approved a $28-million Threshold Program for Guatemala.