Without giving any explanation, Executive Secretary Salvador Medialdea lifted the ban the government earlier imposed on the negotiation and signing of loan and grant agreements with 18 countries that backed Iceland’s resolution in the UN Human Rights Council calling for an investigation on human rights (HR) violations in the Philippines.
The suspension was meant to protest the impression created by the resolution that the Philippine government was not doing anything about complaints of HR abuses.
Among those countries are Australia, France, Germany, Italy and Spain, all major sources of loans and grants to the Philippines.
Finance Secretary Carlos Dominguez III had said the suspension of talks with those countries “will not have a significant impact on the country.”
In an apparent show of bravado, he further said his department was in “exploratory talks” with other countries that did not back the resolution to see if they could provide funds for projects that would be hit by the suspension order.
That was then.
The lifting of the ban shows those talks did not prosper (assuming there were really such), and that in spite of the economic managers’ glowing remarks about the country’s economic health, the government can ill afford to forgo those loans and grants.
So, for now, the 18 countries are not considered hostile to the Philippines and their offers of financial assistance would once again be welcome and appreciated.
Their leaders must be smiling in silent amusement about the softening of the hard line stance of the government on HR violations issues. Pride gave way to reality.
The resumption of loans and grants negotiations, however, does not mean the unfavorable image of the Philippines in the international community has been erased.
In the protocol-bound world of foreign financial negotiations, suspending or canceling discussions out of pique, or for imagined hurts, or for issues that have no bearing on the subject of the transaction is considered inappropriate or unprofessional.
For loans and grants that have had significant headway before the ban was issued, the resumption and completion of their negotiation would not be a problem, especially if the contracting parties had entered into similar or “templated” agreements before.
Except for changes in the objectives, amount involved and the names of the intended beneficiaries, it will simply be cut-and-paste.
It is a big question mark, however, when it comes to loans and grants that are already in the creditor or donor country’s pipeline but have not been presented to the Philippines at the time of the ban.
Would the funds be available still?
Bear in mind other developing countries are as much interested in securing loans and grants from the lender countries that voted in favor of Iceland’s resolution. It is not far-fetched those developing countries may have lobbied with the lenders to shift their funding operations to them rather than to “pride-stricken” Philippines.
Or perhaps the lender countries, in order to meet the timelines of their budgets for external loans and grants, opted to shift gears and divert those funds to other equally needy countries.
Indeed, why should they go out of their way to reserve these funds for the Philippines when it earlier said it could do without them and there are countries that can make good use of them?Common sense dictates that financial assistance should be given to those who will welcome them with gratitude rather than with contemptuous arrogance.When government representatives go back to the lender countries with their begging bowl, they should not be surprised if they get a not-so-warm reception, or HR-related conditionalities are attached to the loans or grants.
Next time the government talks big, it better have something to back it up; otherwise it may end up eating its words. INQ
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