Washington considering second MCC compact for PHL
THE UNITED STATES is considering a new aid package for the Philippines, withheld over human rights concerns late last year, but a clear offer has yet to be made, the Department of Finance (DoF) said.
Finance Secretary Carlos G. Dominguez III said that although he has been in talks for a possible grant by the foreign aid agency Millennium Challenge Corp. (MCC), there was no concrete offer made to renew the Philippine compact.
“I’ve talked to the Millennium Challenge people maybe three times already, and they said they want to have a second compact. So okay fine, but we’re not going to wait… we’re going to do what we can… while they do their own process. They haven’t decided,” Mr. Dominguez told reporters on Thursday at the DoF headquarters.
Mr. Dominguez noted that the government has engaged with the MCC “several times,” with the recent one being during the Philippine delegation’s March 27-28 visit to Tokyo for the Joint Committee on Philippines-Japan Infrastructure and Economic Cooperation meeting.
“I believe the (Trump) administration has not really decided what to do with the Millennium Challenge. We have nothing to do with the Millennium Challenge, except when they come to us and make us an offer. So I’ll just wait,” he said.
The US Congress created the MCC to provide large-scale grants in an effort to reduce poverty around the world through sustainable economic development.
The MCC deferred what was supposed to be the second major aid package to the Philippines amid concerns over extra-judicial killings.
The MCC declared the Philippines eligible for the second compact in December 2014, and reaff irmed this view in the same month in 2015.
The first compact was a fiveyear grant that ended in May 2016, worth $433.08 million.
It was “aimed to reduce transportation costs through road rehabilitation, expand the fiscal space through improved tax collection efforts, and empower communities by investing in small- scale, community- driven development projects,” according to the MCC’s Web site.
Prior to the inaugural compact, the MCC awarded the Philippines in July 2006 a threshold program — a relatively smaller grant given to countries that “come close to passing these criteria and are firmly committed to improving their policy performance” — worth $20.69 million, spread over three years.
To be eligible for a grant, the country “must demonstrate a commitment to just and democratic governance, investments in its people and economic freedom.”
The Philippines won passing grades in 13 of the 20 indicators set by the MCC, including civil liberties, rule of law, and government effectiveness.
Asked about the government’s possible response once an offer is on the table, Mr. Dominguez said that he will first ensure whether the possible conditions tied with the grant are aligned with the administration’s priorities.
“We will consider their offer. Is it in our priorities, are the terms reasonable, is our sovereignty not affected? But so far, nothing. We’ve engaged with them several times,” he said.
Mr. Dominguez recommended that Malacañang reject a grant from the European Union worth $280 million, claiming it would interfere with the country’s internal affairs.
“They know our priorities, they know it already. We told them our priorities, they’ve asked us before, we told them these are our priorities,” he said.
The Philippine Development Plan 2017- 2022, which was approved and ordered implemented by President Rodrigo R. Duterte, aims to make growth more inclusive by pushing development to the countryside, ramping up infrastructure and social spending, improving the ease of doing business, making the tax system more eff icient, improving transparency and accountability in governance, as well as reducing criminality and all forms of illegal drugs.
“It’s undergoing an American process, we are not involved. So the Americans have to decide under the new administration what they want to do. So I don’t think they’ve decided,” said Mr. Dominguez.