Because of the immense funding needed for the coronavirus pandemic response, with revenue sources massively reduced amid the economic contraction, the government has had to obtain funds from foreign sources. Officials said that as of Nov. 4, the government had secured a total of $10.1 billion in loans and grants for the COVID response. Obviously, grants that need no repayment should be preferred over loans, no matter how soft the repayment terms.

A grant of over $400 million would go a long way in the pandemic response, especially in the procurement of COVID vaccines that several foreign pharmaceutical companies are expected to roll out within a few months. Senators have lamented what they consider to be a small allocation for vaccine procurement in the proposed national budget for 2021.

A decade ago, the country qualified for a five-year grant of $433.91 million from the US Millennium Challenge Corp. The MCC was established by the US government in 2004 to provide grants to developing countries that demonstrate a commitment to good governance, which places them on the path of solid and sustainable economic growth.

Countries need to pass at least 10 of 20 indicators, plus two “hard hurdles” – either the “political rights” or “civil liberties” indicator, and the “control of corruption.” A Sept. 8 report of the MCC said the Philippines, whose first MCC grant expired in May 2016, was one of 68 countries being considered for the new package.

A report this week, however, showed that while the Philippines passed 12 of the 20 indicators, it failed one of the “hard hurdles” – control of corruption – and cannot qualify for the MCC grant. The country also failed in rule of law and freedom of information. Philippine officials said the country would opt instead for funding assistance from the US Agency for International Development. USAID has extended P780 million so far for the Philippines’ pandemic response. Still, the MCC aid would have been a significant addition to the pandemic resources.

President Duterte has given priority to the campaign against corruption. But there are major obstacles in his path, among them corrupt politicians and magistrates, and an ombudsman who has become a champion of opaqueness in government. The country’s failure to qualify for the MCC grant in this public health crisis should add to the government’s resolve to fight corruption.

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