EDITORIAL - Proper aid utilization

The official word yesterday was that the Philippines was no longer on a French blacklist of countries that are uncooperative in investigating foreign aid fraud. Manila sought the clarification from Paris following a report from the French capital that the Philippines and 16 other countries were on the blacklist, with their banks banned from distributing foreign development funds.

Foreign Secretary Albert del Rosario said the list was an old one. How old is unclear. The report from Paris said the Philippines was one of eight original “non-cooperative states and territories” that included Botswana, Brunei, Guatemala and Nauru. Recent additions to the list reportedly include Costa Rica, Dominica, Lebanon, Liberia, Panama, Switzerland, Trinidad and Tobago, the United Arab Emirates and Vanuatu. Paris, also the home of the Financial Action Task Force against money laundering, reportedly noted the lack of transparency on foreign aid utilization among those on the blacklist.

The Philippines has been rocked by several corruption scandals in the past years involving foreign-funded projects. If enough reforms have been implemented to get the country out of the French blacklist, the daang matuwid administration should make sure the reforms are institutionalized and sustainable beyond the term of President Aquino. 

The previous scandals derailed the implementation of development projects and, in the case of two road deals, led to the debarment of several Philippine contractors from projects financed by the World Bank.

Most international aid donors have stringent rules to ensure the proper utilization of official development assistance. The Philippines, which remains heavily dependent on ODA for many anti-poverty and development projects, should match these rules with its own – and see to it that the rules are followed – to reassure donors that their aid is utilized properly. When ODA is reduced or halted, those who feel the pain are often the impoverished people who need aid the most.