Philippines, EU forge financial deal to improve good governance in LGUs

Foreign Affairs Secretary Albert del Rosario. AFP PHOTO

MANILA, Philippines  – The Philippines and the European Union on Monday forged a deal granting P440-million worth of grants to local government units (LGUs) that is aimed to “improve public finance management at the local level.”

“This new EU project will contribute to the government’s efforts to improve good governance throughout the country,” Ambassador Guy Ledoux, head of the EU delegation to the Philippines, said in a statement.

According to Ledoux, the project will provide expertise and training to public officials in charge of managing public resources.

“As a result, public services to local communities will improve,” he said.

Foreign Affairs Secretary Albert Del Rosario, for his part, said that the move was one of the manifestations of the developed relations between the Philippines and EU, and that it was in support of President Benigno Aquino III’s vision towards good and open governance.

“The specific objective of this agreement is to enhance the capacity of local government units to generate revenue and allocate and spend public funds more effectively and efficiently,” Del Rosario said in his opening remarks before the signing of the agreement.

The project, entitled, “Support Local Government Units for more effective and accountable Public Finance Management,” would be implemented by the Department of Budget and Management (DBM).

Ledoux said that the training, which would take place mainly at the Regional Offices of the DBM in charge of supervising LGUs, would involve the introduction of organization methods such as revenue forecasting, performance based budgeting, internal control systems, internal audit services and monitoring and evaluation.

It would also include components that focus on improving transparency and accountability of LGUs.

“EU remains to be one of our major strategic partners in supporting our development goals especially in pursuit of poverty reduction, supporting access to basic social services, helping economic, social and political reforms and contributing to restore peace and security, especially in Mindanao,” Del Rosario said in a statement.

The Philippines and EU were also set to sign the landmark Partnership Cooperation Agreement (PCA), which the EU has described as an agreement that would serve as the framework and foundation of the countries’ bilateral relations.

In an email interview with Inquirer.net, Ledoux said that the PCA would be the first bilateral link between the EU and the Philippines, and that it would enable an institutionalized bilateral dialogue and structure to cover more areas of cooperation and address issues between the two countries.

“The new PCA demonstrates the commitment of the EU to forge a modern, broad based and mutually beneficial partnership with the Philippines. It will broaden the scope of EU-Philippines relations in areas such as counter-terrorism, the fights against corruption and organized crime, trade and investment, migration and energy as well as other issues,” Ledoux said in the email interview.

The agreement would be signed by Del Rosario and High Representative Catherine Ashton of the EU Foreign Affairs on July 11 at the sidelines of the Association of Southeast Asian Nations Regional Forum in Phnom Penh.

The agreement was expected to push negotiations for a free-trade agreement that would allow the Philippines’ greater access to European countries, as well as facilitate trade and investments between the two countries.