Aid from friends

The longer you stay in the Philippines, a visiting British official was warned by locals the other night, the less you will understand the country.

His two-night stay in Manila should then make him an expert on the Philippines, Jeremy Browne joked at a reception.

Browne, minister of state of the newly installed Liberal Democrat government (yes, the party has ties with P-Noy’s Liberals), left the country yesterday morning for Indonesia, bringing with him his message about the need for Britain to “elevate engagement with emerging economies” particularly in this part of the world.

“Please engage us,” he said at the reception. “We want to help. We want to have a high profile.”

Browne could crack jokes about leaving the Philippines so soon. Other diplomats stay around longer, and probably think that statement about failing to understand the country is not a joke.

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French Ambassador Thierry Borja de Mozota worked for about a year to persuade his country’s aid arm, Agence Francaise de Developpement (AFD), to open a soft loan facility for the Philippines.

The ambassador has seen poverty and many other problems up close in his visits to various parts of the country, and has been asking local government executives about problems that could be mitigated using foreign funding.

French official development assistance is not easily obtained; Paris has aid programs only with about 60 countries, many of them former French colonies in Africa. In this part of the world, only Vietnam, Cambodia and Laos – the former French Indochina – received French foreign aid for many years, until the recent addition of Indonesia.

Ambassador Borja de Mozota argued his case and finally received approval from Paris early this year for the opening of the loan facility, in cooperation with the Asian Development Bank. The amount is nothing to sneeze at, considering Europe’s current economic woes: 150 million euros, or the equivalent of P10.5 billion.

The loan agreement was signed last Feb. 15. The ambassador told me two nights ago that if he had postponed the signing to avoid the campaign period or wait for the change of government, the loan would have had to wait a year.

Even the loan release didn’t wait; everything was disbursed by May. Although corruption scandals hounded the Arroyo administration and it faced deep public mistrust, it was still the Philippine government, and bilateral relations are pursued with a presumption of regularity on both sides.

Manila asked for a budget support loan – essentially a blank check, with the recipient allowed to use the money as it pleases, unless there is prior agreement that the funds must be used for areas specified by the donor. In this case, the ambassador told me, the loan, while coursed through the Department of Finance, is expected to go to local governments, particularly the many aspects of urban development, which could include environmental protection. 

The AFD, which has not finished setting up its Manila office, announced that its aid program promoted various facets of development, with climate change mitigation among the priorities.

In the wake of typhoon “Basyang” and the consequent three-day blackout, former finance chief Gary Teves was asked what climate change projects would be financed with the French loan. Climate change? He said it was a budget support loan (it was, as per the official agreement), which he said the national government used to plug the yawning deficit.

Climate Change Commission head Heherson Alvarez said he heard of the loan facility only when he received a visit from two AFD officials on June 23. The commission has not received any share of the loan.

Teves has emphasized that the loan was not diverted in the heat of one of the ugliest election campaigns we have seen. It was for budget support, he said, and that was what it was used for.

The ambassador told me that the loan is not a climate change fund, and his government is still expecting Manila to present a list of specific projects for local governments that will be financed with the loan, which could include environmental protection.

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Perhaps signals got crossed or something was lost in translation. Teves’ successor Cesar Purisima, together with Jesse Robredo if the French want this for local government units, plus new environment chief Ramon Paje if the AFD wants climate change projects, can trace the funds and sort everything out.

The ambassador told me he was hoping to make this a five-year loan program, at 150 million euros per year. But the next releases will depend on how the first one turns out.

With about 35 percent of our population living below the poverty line, and all the problems begging for funding, our country continues to depend on a lot of help from friends. That France has joined the ranks of donors, with a hefty opening contribution, should be much appreciated by a cash-strapped government, now busy tracing depleted funds, and by the people who will benefit from the aid.

We have seen the international goodwill accompanying the rise to power of the only son of Ninoy and Cory Aquino.

Jeremy Browne, in his first visit to the region as state minister of a government that was installed almost at the same time as P-Noy’s, picked the Philippines as one of his destinations together with Thailand, Hong Kong and Indonesia.

“We wish (Aquino) well… We are more than happy to help,” Browne said at the reception hosted by British Chargé d’Affaires Colin Crorkin and his wife, Consul Joanne, at their home.

When Cory Aquino became president, the international donor community held a pledging session and put together the Philippine Assistance Program (PAP) to jumpstart economic recovery.

But endless coup attempts disrupted recovery, the government could not put up counterpart funding, and PAP aid utilization was slow. 

Today we are not among the world’s poorest of the poor, although sometimes life could feel that way in this country. Our level of economic development no longer qualifies us for financial aid from certain countries such as Britain. We have graduated from our program with the International Monetary Fund.

Perhaps one day we might (why not?) even become part of the international donor community. But until that happens, we owe it to donors to show that every centavo of their aid, bankrolled by their taxpayers, is used judiciously and with utmost transparency.