On the other hand, the Philippines is likely to obtain an additional $20 million in assistance under the $5 billion Millennium Challenge Account (MCA), an initiative of the Bush administration that increases aid to countries which promote good governance as well as invest in the education and health of their people.
James Kunder, Assistant Administrator for Asia and the Near East of the US Agency for International Development (USAID), raised the matter with President Arroyo during their meeting at Malacañang.
"You realize that the problems in (human) trafficking are severe here. The Philippines is both a destination for trafficking for persons and also a source for trafficking of persons and there are problems of both internal problems and regional problems where young Filipinos are induced to go to other countries for illicit purposes," Kunder said at a press briefing in Malacañang.
"It’s my sense that the President (Arroyo) is certainly taking this issue very seriously and the recently passed trafficking law will be an important step forward," he said.
Kunder is in the country on the first leg of a three-nation swing that also includes Indonesia and Thailand to discuss similar issues with their leaders. He also visited the Visayas Foundation, a private halfway house project in Manila that shelters victims of human trafficking.
He said he noted to Mrs. Arroyo that while the Philippines has succeeded in passing Republic Act No. 9208 or the Anti-Trafficking in Persons Act in 2003, there have been no convictions since the law was enacted.
He said Ambassador John Miller, Director of the Office to Monitor and Combat Trafficking in Persons at the US State Department, is visiting the country in December to personally look into the problem.
"So this is an important issue. I think the problems are serious, I think the government understands the problems are serious and are taking steps to address them," Kunder said.
When asked whether the situation would lead to cuts in USAID assistance, he said that delivery of aid to the country is not being affected at the moment despite the problem of human trafficking.
Kunder said one of the things he discussed with Mrs. Arroyo was how to work out an assistance program to help combat human trafficking.
Under US laws, he said, countries that experience trafficking of persons are placed into one of several categories or tiers. Countries with no human trafficking problems are categorized as Tier 1.
Countries that are doing something to combat their human trafficking problems fall under Tier 2 while those that do not are classified as Tier 3, he explained.
The Philippines is currently classified as Tier 2.
"If you fall into Tier 3 status, it can affect the assistance level to that country and that was one of the issues that the chargés and I discussed with the President, that if the RP were to fall into Tier 3, that could affect the foreign assistance level in the country," Kunder said.
He said countries under Tiers 2 and 3 are monitored under US laws on an annual basis and the Philippines would be checked next year.
But all in all, Kunder described meeting with Mrs. Arroyo at Malacañang yesterday as "fruitful."
"We also discussed the fact that the Philippines is likely soon to receive additional US government funding under the Millennium Challenge Corp. (MCC) program, a new funding category providing US government assistance to those countries that have shown a willingness to take the lead in addressing some issues on development," Kunder said.
He expressed hope that the Philippines, in close coordination with the USAID, would be able to receive $20 million in assistance under the MCA. The MCC was set up in 2002 to handle requests for assistance under the MCA.
Kunder said countries seeking assistance funds from the MCA must go through a two-stage process wherein the country first applies for a threshold status to address a particular problem they are facing.
If a country accomplishes what are called its threshold goals, it then can apply for a "compact status" under the MCC for increased financial assistance.
He said the Philippines is currently seeking $20 million from the MCA under the threshold status.
"I think the chance — I cannot predict how the MCC will finally vote — I think the chances are excellent that the government of the Philippines would achieve that funding level," Kunder said.
He said if the government utilizes the $20 million properly, it can easily seek additional MCA funding.
Last May, Foreign Affairs Secretary Alberto Romulo met MCC Chief Executive Officer Paul Applegarth to follow up on the country’s project proposal to achieve its economic reform goals and fight against poverty before being awarded MCA funding.
Romulo informed Applegarth that the government "views good governance and anti-corruption as central to its economic reform and poverty alleviation drive."
Agencies involved in the project proposal submitted to the MCC are the DFA, Department of Finance (DOF), Office of the Ombudsman, Philippine National Police (PNP), and the Armed Forces of the Philippines (AFP).
Upon approval, the proposal will be developed into a threshold country plan that will be funded by the MCC for two years.
Manila was designated as one of the 11 countries under the MCA 2005 Threshold Program.
Aside from the Philippines, countries in the program are Burkina Faso, Malawi, Guyana, Paraguay, Zambia, East Timor, Kenya, Sao Tome, Tanzania, Uganda and Yemen.