U.S. aid group defers PH grant over human rights concerns

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Metro Manila (CNN Philippines) — A United States aid group has put on hold a possible grant to the Philippines, citing concerns over reports of human rights violations in the government's anti-drug campaign.

Economic managers shrugged off the snub, though, saying various countries and international organisations are ready to pour funding into the Philippines regardless.

The Millennium Challenge Corp. (MCC) concluded its review of recipient countries on Tuesday and awarded five-year grants to Burkina Faso, Sri Lanka and Tunisia.

The Philippines, however, was not chosen, despite having received MCC grants since 2006 and being identified for renewal this year.

"The Board... deferred a vote on the reselection of the Philippines for compact development, subject to a further review of concerns around rule of law and civil liberties," the MCC said in a statement on its website.

U.S. Embassy Spokesperson Molly Koscina said in a separate message that countries are expected to have "demonstrated commitment" to due process and human rights to remain eligible for MCC assistance.

The Philippines won a preliminary $21-million grant from the MCC in 2006, and a much larger $434-million grant in 2011.

It went on to fund the modernisation of the Bureau of Internal Revenue, the upgrade of a major highway in Samar, as well as community development projects in some of the poorest areas in the country.

The grants were estimated to benefit more than 5 million Filipinos.

Since its creation in 2004, the MCC has provided more than $10 billion worth of aid for developing countries.

However, it requires aid recipients to commit to good governance, economic freedom and investments in their citizens.

The administration's clampdown on illegal drugs has turned increasingly bloody. Since the start of President Rodrigo Duterte's term, 2,102 people have been killed in police operations as of Wednesday. Another 3,994 people have died in unexplained circumstances as of Monday.

The government has always maintained that police follow due process, only using lethal force when the drug suspects resist arrest.

In his speeches though, the President regularly talks about issuing shoot-to-kill orders. Just this week, he talked of killing drug suspects himself when he was still Davao City Mayor - to show the police that "if I can do it, why can't you?"

This isn't the first time the drug war has compromised a deal for the country. Last month, the U.S. State Department probed a sale of 26,000 assault rifles to the Philippine National Police.

The President's response then was to say the Philippines would just turn to other countries - particularly China and Russia - for firearms instead.

It was the same response here, with economic managers saying on Thursday that other lenders could more than fill the gap.

Socioeconomic Planning Undersecretary Rolando Tungpalan said he had just met with the Asian Development Bank and the World Bank, who were keen to finance projects in the Philippines. Japan, China and Korea also want to provide funding.

"They're all searching for projects because they don't want to be left behind in terms of participating in this big push of the next six years," he said in a press conference.

Ernesto Pernia, Socioeconomic Planning Secretary, even brushed off the snub, saying the money the Philippines got from the MCC was "insignificant."

"Given the amounts of investments that many countries are interested in putting in, that's really nothing. I would not lose sleep over that," he said.

This could set a precedent, though, since other international organizations also put a premium on human rights records.

The European Union and the Philippines are set to review their free trade agreements before the yearend.

Under the Generalized Scheme of Preferences Plus (GSP+), the country has enjoyed duty-free treatment for more than 6,000 export products to the EU since 2014.

Human rights and good governance, however, are conditions for beneficiaries of the GSP+.