MANILA, Philippines?The United States is set to enter into a compact with the Philippines granting the Aquino government some $434 million (P20 billion) in aid, the US Embassy said yesterday.

This is the first foreign assistance program granted by the United States during President Aquino?s term.

?This marks a vote of confidence in the Aquino administration and its commitment to confront corruption,? US Ambassador Harry Thomas Jr. said in a statement.

The Philippines was judged to be eligible for an MCC aid compact in March 2008. The aid compact, to be coursed through the Washington DC-based Millennium Challenge Corp. (MCC), would provide funding for three major projects amounting to $388.7 million. They are:

? $54.3 million for the redesign and computerization of key business processes within the Department of Finance?s Bureau of Internal Revenue to increase the efficiency, sustainability and integrity of revenue collection

? $120 million for the expansion of Kapit-Bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery of Social Services (Kalahi-CIDSS), a community-based rural development program of the Department of Social Welfare and Development that focuses on small-scale infrastructure and other services that would stimulate economic growth and reduce poverty

? $214.4 million for the construction and rehabilitation of the 220-kilometer Samar Road that passes through 15 municipalities

? The remainder ($45.5 million) would be used for other projects.

Thomas lauded MCC?s pledge, saying: ?Today?s decision by the MCC Board of Directors, chaired by Secretary of State Hillary Clinton, marks a vote of confidence in the Aquino administration and its commitment to confront corruption. The MCC grant will support President Aquino?s efforts to reduce poverty, stimulate economic growth, combat corruption, and ensure a better future for all Filipinos.?

In a separate statement, Foreign Affairs Secretary Alberto Romulo said: ?This is excellent news?an affirmation of the US government?s confidence in the Philippines? strong commitment to good policy performance.?

Romulo added that the Philippine government had consistently demonstrated the highest level of political commitment to the MCC Millennium Challenge Account (MCA) compact process.

In a letter to US President Barack Obama on July 8, Aquino conveyed his commitment to MCC?s principles of ruling justly, investing in people and promoting economic freedom.