Donor countries are not pleased at the way the Philippines is conducting its war on illegal drugs. With over half of the 5,000 killed in the campaign under questionable circumstances, donors are naturally alarmed over the rule of law in the Philippines.
Millennium Challenge Corp., an innovative and independent US foreign aid agency helping lead the fight against global poverty, has disqualified the Philippines from the list of countries that can avail of a second grant following “concerns around rule of law and civil liberties.”
MCC enforces an unconventional set of criteria in approving funding assistance designed to reduce global poverty. It measures a country’s commitment to democratic principles, including political rights and civil liberties. Meeting these criteria is critical to passing MCC’s scorecard and obtaining funding from the agency.
Countries, through their partnership with MCC, should maintain their commitment to democratic rights. A significant policy reversal may prompt MCC to issue a warning, suspend or terminate eligibility for aid.
The Philippines obviously failed to live up to the innovative standards of MCC. The Philippines applied for a second “compact” loan that would have focused on boosting agriculture and competitiveness to create a more significant impact on reducing poverty.
The Philippines should not belittle MCC’s grants. The agency in 2011 granted the country $434 million to finance three projects on boosting revenue collection efforts, strengthening poor communities and developing national roads for five years. The US Embassy lauded the first compact as “a strong example of how the US and the Philippines worked together to unlock economic growth and lift people out of poverty.”
MCC may not be the last donor to give the Philippines a negative scorecard amid the brutal campaign of President Rodrigo Duterte against drug users and dealers, especially those carried out under suspicious conditions.
But the Philippines definitely lost MCC as a source of official development assistance after failing the mark in the agency’s civil liberties indicator. MCC has sent a clear message on the importance of democracy to good governance.