INTERVIEW
World Bank to lend $300M to the Philippines
By Rosemarie Francisco
Reuters
First Posted 19:16:00 03/27/2008
CLARK, Philippines -- The World Bank plans to lend the Philippines $300 million in the current fiscal year, $110 million less than the previous year, after funding on a corruption-tinged road-building project was delayed.
"This year, we're probably going to end up with about $300 million, and hopefully that will include the roads project," Bert Hoffman, World Bank country director for the Philippines, told Reuters in an interview on Thursday.
The granting of new loans to the Philippines depends on the pace at which government agencies work on the requirements needed to get the project going, Hoffman said.
The bulk of lending in the current fiscal year to June will be for the controversial $330-million road-building project.
"This wasn't a great year, to be honest," Hoffman said, referring to the lower level of lending.
The World Bank, which is providing $232 million for the roads project, put the funding on hold late last year after it discovered bid-rigging in the first phase between 2003 and 2006. The rest of the project financing will be provided by the government.
The second phase of the roads project has been revived and will be presented to the bank's board for approval in June after the government and the World Bank set up new procurement processes and measures to prevent rigging.
"We're getting civil society involved in overseeing the results of the building of the roads," Hoffman said.
"We learned from it and in the next phase of that project, actually there are even stronger measures on transparency and competition which we believe are the best guards against corruption," he said.
Corruption is a major problem in the Philippines, particularly when large infrastructure contracts are up for grabs.
The country was ranked 131 out of 179 countries by graft watchdog Transparency International in 2007, the same rating given to Libya and Burundi.
In the first phase of the road project, 382 kilometers (237 miles) of roads across the archipelago were built or upgraded, and 975 km of existing roads where a dilapidated transport network hinders development had been paved and maintained.
In the second phase, 146 km of roads will be upgraded and 304 km will be rehabilitated or widened.
Other Philippine projects that the World Bank plans to fund this year are an anti-flooding system in the typhoon-prone Bicol region south of Manila and some rural electrification projects. (Reporting by Rosemarie Francisco; editing by Jacqueline Wong)
($1 = P41.84)
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