Query

Please provide an overview of corruption and anti-corruption efforts in the Philippines.

Background

In May 2022, the election of Ferdinand “Bongbong” Marcos Jr., son of former President Ferdinand Marcos Sr., as the new President of the Philippines, and Sara Duterte, daughter of former President Duterte, as the Vice President, epitomised how national politics in the country have come to be dominated by clientelist political dynasties.

The dictatorial rule of Marcos Sr. between 1965 and 1986 was marred by grave human rights violations and corruption. This included tens of thousands who were killed, tortured, arrested and disappeared, and embezzlement of USD 5-10 billion from the state budget, something that stalled the Philippine’s socio-economic development by decades (The Diplomat, 2022).

The more recent rule of President Rodrigo Duterte (2016-2022) featured the notorious “war on drugs”, a strongman approach to governance, and the side-lining of checks and balances. This contributed to a permissive environment in which the security forces perpetrated thousands of extrajudicial killings, arbitrary detention, and torture of prisoners (Freedom House, 2022). The victims included not only drug addicts and dealers, but also the urban poor, political opponents, and people accusing the ruling elites of corruption and rent-seeking (Global Witness, 2019). Duterte also used lawsuits and incarceration to suppress opponents. In February 2017, a prominent critic of Duterte’s “war on drugs”, opposition Senator Leila de Lima, was arbitrarily arrested. Despite continuous calls from the European Parliament, the UN, and the Amnesty International to release her, de Lima remains imprisoned as of August 2023 (UN, 2023). The suppression of dissent and widespread impunity for abuses of power also created fertile ground for corruption. Furthermore, a lack of effective witness protection mechanisms has hindered the investigation of crimes committed by the security forces whose political influence has increased in recent years (Freedom House, 2022).

The killings associated with the “war on drugs” have continued since Marcos Jr. took office. During 2022, the police and other unknown vigilante groups committed 324 drug-related killings, of which 175 took place after July 2022, according to Amnesty International (2022). It is noteworthy that 152 people were killed during the anti-drug police raids within the first five months of Marcos Jr.’s presidency. This number exceeds the 149 drug-related killings recorded during the final six months of Duterte’s presidency (Harvard International Review, 2023). However, the total number of killings of drug suspects by police and unnamed assassins combined was much higher, meaning the numbers of killings by uniformed police alone do not account for the entirety of extrajudicial killings (David et al. no date). The number of political prisoners is also on the rise with 25 arrests in the first five months of Marcos Jr.’s presidency, prompting the hundreds of citizens to protest in front of the presidential palace in Manila in December 2022 (AP News, 2022). Unlawful killings, arbitrary detention, and repression of human rights activists, and journalists have also continued while impunity for all those crimes has remained entrenched (Amnesty International, 2022).

During Duterte’s presidency, the Philippines increased its dependence on Chinese trade, aid, and investment while distancing itself from the US, the UN, and norms promoted by the international community (Timberman, 2019). Marcos Jr. seems to want to improve the country’s relationship with the US, as witnessed by the recent approval of four additional sites for the US military under the Enhanced Defense Cooperation Agreement (EDCA) (ISEAS-Yusof Ishak Institute, 2023). However, like Duterte, he also encourages Chinese investments by allowing the China Communications Construction Company Limited (CCCC), an entity blacklisted in the US, to implement large infrastructural projects in the Philippines (Rappler, 2023).

In February 2018, the International Criminal Court (ICC) started an inquiry to determine whether the state-sponsored violence carried out during Duterte’s “war on drugs” constituted crimes against humanity. A month later, the Philippines withdrew from the ICC and refused to cooperate with the judicial body. As a result, the investigation was suspended (Bertelsmann Foundation, 2022). In January 2023, the ICC resumed investigations into the “war on drugs” on the basis that investigations conducted by the national authorities were inadequate. To date, Marcos Jr.’s government has maintained Duterte’s position of non-cooperation with the ICC. In February 2023, the Philippines government requested the suspension of the ICC investigation(Human Rights Watch, 2023). In July 2023, the ICC Appeals Chamber confirmed the authorisation to resume investigations, which is still pending (ICC, 2023).

In July 2019, the U.N. Human Rights Council adopted a resolution requesting the Office of the High Commissioner for Human Rights (OHCHR) to present a report on the human rights situation in the Philippines. A month later, Duterte ordered the Philippines government to reject financial assistance from the 18 countries that supported the resolution (Bertelsmann Foundation, 2022). In October 2022, the UN Human Rights Council failed to adopt a resolution that would renew OHCHR’s mandate to monitor and report on the human rights situation in the Philippines (Amnesty International, 2022).

Economic outlook

The Philippines is a lower middle-income country with a population of around 115 million people. It is one of the fastest growing economies in the East Asia and Pacific region with a 7.6 percent annual GDP growth as reported by the World Bank in 2022, a two percent increase from 2021. The country’s GDP per capita has more than tripled over the past 22 years, from US$1,073 in 2000 to US$3,498 in 2022 (World Bank, 2022). The services sector, particularly telecommunications, business process outsourcing, and finance, comprises 61 percent of the Philippines’ GDP and provides employment for 57.6 percent of the country’s labour force. The industry sector including food processing, cement, glass, chemicals production, and iron and steel manufacturing, comes second with 28,4 percent contribution to the GDP and 19.8 percent of the total workforce. The agriculture sector, especially the production of coconut, sugar, and rice, comes next with 8.5 percent contribution to the GDP and 25 percent of the labour force (Asia Fund Managers, 2023).

Nevertheless, with a Gini index of 40.7, the Philippines has one of the highest income inequalities in East Asia and the Pacific. According to the World Bank, the poverty incidence rate in the Philippines was 18.1 percent in 2021, a two percent increase from 2018. This means that there are 19.9 million poor people living in the country, an increase of 2.3 million from 2018, amounting to 17.2 percent of the country’s total population (World Bank, 2023). The inflation rate is also on the rise standing at 5.8 percent in 2022, a two percent increase from the previous year (World Bank, 2022). The ruling elites make decisions in their favour, leaving the needs of the country’s poor and middle class unattended, which according to the Bertelsmann Foundation (2022), hinders the country’s transition to democracy and just market economy.

Extent of Corruption

The Philippines is perceived to be a highly corrupt country. It scored 33 out of 100 and ranked 116 out of the 180 countries assessed by Transparency International’s 2022 Corruption Perceptions Index (Transparency International, 2023). 86 percent of people think that government corruption is a big problem while 19 percent of public service users paid a bribe in the previous 12 months, according to Transparency International’s 2020 Global Corruption Barometer. At the same time, most respondents thought that the national and local government officials, police, members of parliament, and judges and magistrates are involved in corruption (Transparency International, 2020).

A 2018 national household survey conducted by the Philippine Statistical Authority and the Office of the Ombudsman found that people mostly give bribes or speed money to public agencies in charge of delivering justice and basic social services. These include law enforcement agencies, prosecution service, the courts, educational institutions, healthcare facilities, and social security and welfare agencies (Office of the Ombudsman, 2018). In another survey of business companies operating in the Philippines, 21 percent of respondents reported that they were asked to pay a bribe and 14 percent said they lost an opportunity to a competitor who they believed paid a bribe. At the same time, 4 out of 10 respondents reported that they had experienced economic crime and fraud, most of which included asset misappropriation, bribery and corruption, customer fraud, procurement fraud, cybercrime, deceptive business practices, and accounting fraud (PwC, 2020).

The Philippines performs poorly in terms of political stability, rule of law, and the control of corruption as evidenced by the assessment of the World Bank through the Worldwide Governance Indicators (WGI), the details of which are provided in Table 1 below. There have been minor improvements in the scoring for the control of corruption indicator, however, it should be noted that this indicator relies on perceptions of corruption and as such may contain margins of error (WGI, no date).

The results of Philippines’ performance on other prominent governance indices are provided in Table 2 below.

Corruption and rent-seeking are widespread in the Philippines. Political and economic elites benefit from a system characterised by oligarchic family dynasties, clientelist politics, patronage networks, and a dysfunctional justice system. The President exerts considerable influence over all major areas of law and policy making, spanning from budgets and appointments to elections, regulatory bodies, and the distribution of government resources. Public servants are often appointed on the basis of patronage rather than through competitive recruiting procedures. Politically motivated dismissals, inefficient use of administrative personnel, and poor management practices are common across government agencies (Bertelsmann Foundation, 2022).

Despite existing antitrust legislature in the Philippines and the country’s accession to the World Trade Organisation (WTO) in 1995, according to the Bertelsmann Foundation (2022), local clans with strong ties to the political elites use conglomerates and cartels to curb competition and create monopolies in major sectors of national economy, including telecommunications, energy, agriculture, food products, and the cement industry. Private businesses find it risky and burdensome to operate in the Philippines due to the high rates of corruption, bureaucratic red tape, high transaction costs, and the lack of institutional autonomy of regulatory agencies. At the same time, due to the stagnation in the government’s economic reforms and the sub-standard local infrastructure, many Filipinos continue to live in poverty or to emigrate in mass to find better lives elsewhere (Bertelsmann Foundation, 2022). Nonetheless, the 2020 Global Corruption Barometer results found that 78% of those surveyed in the Philippines believe that ordinary citizens can make a difference in the fight against corruption (Vrushi, 2020:3 0).

Forms of corruption

Grand corruption

Grand corruption enables political clans and dynasties in the Philippines to maintain their grip on power by enriching themselves while in office, then using the proceeds of corruption to entrench their political power. The lack of checks and balances and the weakness and inefficiency of anti-corruption institutions allow corruption to thrive in the highest echelons of the government.

According to Batalla (2020), private firms, individuals, and foreign entities are encouraged by the Philippines government to engage in rent-seeking, illegal economic activities, and deception to generate income to bribe the ruling elites.

Apart from systematically demanding bribes from private companies for various government services, such as the issuance of construction permits and the administration of import and export procedures, public officials also engage in corrupt deals with extractive industries in the management of the country’s natural resources. As discussed below, this is especially the case when the relevant authorities grant permits to companies for their mining projects without competitive bidding or community consent. These dynamics are further entrenched through the use of martial law for three years in Mindanao to suppress dissent from indigenous communities and environmental activists flagging the negative impact of those projects on local residents and the environment. Despite the lifting of martial law, activists believe that as long as armed forces maintain a significant presence in Mindanao, they will continue to protect their investments from farmers and indigenous communities (Aspinwall 2020).

The Ombudsman’s Office responsible for filing charges against corrupt government officials, prosecution and the judiciary suffers from undue influence from the government, which hinders the ability of the judicial system to bring perpetrators to justice. For instance, of the officials fired by Duterte in 2018 due to alleged corruption and misconduct, 20 were not charged, four were re-appointed to other government positions, and only two from the Bureau of Immigration were charged with corruption-related offences (Rappler, 2018 a).

Grand corruption in the Philippines is particularly widespread in contracting large infrastructure projects, such as the building of national roads, as contracts are sometimes awarded without a competitive public bidding and based on the government’s covert agreements with local and international companies who are reported to pay kickbacks to top-level government officials.

The Philippine government’s 2007 agreement with a Chinese state-controlled firm, the Zhongxing Telecommunications Equipment (ZTE), to implement information technology projects in the Philippines serves as an illustration. ZTE, backed by the then President Gloria Macapagal-Arroyo, initially proposed US$130 million for the project. However, this price was increased almost threefold to US$329 million at the time of signing the agreement, resulting in the filing of graft and bribery charges against Arroyo and her allies in government. The government’s agreement with the ZTE was cancelled as a consequence (Batalla, 2020).

In another recent case, Dionisio Alvindia, the Director of the Philippine Center for Postharvest Development and Mechanization (PhilMech) of the Department of Agriculture, uncovered a corrupt procurement processed by the PhilMech during the time of his predecessor. Specifically, the Center purchased 1,346 overpriced farm tractors (P98,000 per unit (US$1,735), taking P130 million (US$ 2.3 million) in kickbacks (Philstar Global, 2022).

Political corruption

Rhetorically, President Duterte pledged to be tough on corruption, declaring during his 2016 election campaign “I will not promise you heaven, but I will try to stop corruption” (CNN, 2022). Yet, as reported by local think tanks and the media, while he fired many of his cabinet members and government officials over allegations of corruption, formal charges were not filed against them and some of them were even re-appointed to other posts within the government.

For instance, Duterte’s close allies and supporters, including former President Gloria Macapagal-Arroyo, the Marcos family, former Tourism Secretary Wanda Tulfo Teo, and former Justice Secretary Vitaliano Aguirre, who were all allegedly involved in cases of conflict of interest, the abuse of public office, and the embezzlement of public funds, according to the reports of the Commission on Audit (COA) and of the media, were held to account for these reported offences (Focus on the Global South, 2019). At the same time, the Bureau of Customs (BOC) officials implicated in a P6.4 billion (US$113.3 million) shabu shipment scandal, described below, were re-appointed to other government positions in the Office of Civil Defense, in the Office of Transportation Security, and in the Civil Aviation Authority (Rappler, 2018 b).

Further, despite the increased number of cases of tax evasion by public officials reported and pursued by relevant authorities, the number of officials who commit tax evasion and the consequent rate of corruption in civil service remains high (Bertelsmann Foundation, 2022). The incumbent President Marcos Jr. was also convicted for tax evasion in 1995, for which he did not face a prison sentence. The former Supreme Court spokesperson Theodore Te claimed that Marcos Jr. falsified his eligibility when running for the office of the president in May 2022 elections (The Philippine Daily Inquirer, 2023).

Philippine politicians have also been complicit in and benefiting from criminal activities, including smuggling, illegal gambling, drugs, trafficking in persons, and money laundering (Timberman, 2019). For instance, in the Philippines’ Autonomous Region of Muslim Mindanao, which is riddled by violent conflicts between local clans and families, five mayors were in the past suspected to be connected to drug syndicates to generate illicit income from drug trade. Alongside the mayors, other local politicians were also involved in various illegal activities, including drug trafficking, gunrunning, kidnapping, car theft, armed robbery, and smuggling. Similarly, seven mayors from the regions of Luzon and two mayors from the Visayas were also suspected to be involved in the illicit drug economy (International Alert, 2013).

The nature of political corruption in the Philippines is particularly evident during elections. Violence and vote buying are common features of Philippine elections, which are dominated by familial political dynasties. Typical violations that occur during elections include intimidation, harassment, and arrests of oppositional candidates, the running out of ballots or the disappearance of ballot boxes from polling stations, as well as manipulating computers to alter election results (Bertelsmann Foundation, 2022).

Vote-buying during elections, especially at the local level, is particularly widespread and systematic and electoral candidates tend to spend millions of pesos per day to buy votes. According to the interim report of the 2022 Philippine elections, around 80-90 percent of voters experience vote-buying. It is common for voters to accept money in vote-buying schemes but to actually vote for another candidate. The amount of money given to the voters by the candidates for various elected positions has also increased. For instance, candidates would reportedly give around P200 (US$ 3.5) for mayoral votes in the past, but in the 2022 elections they reportedly had to give between P2000 (US$35.5) to P4000 (US$ 71) (ICHRP/IOM, 2022).

Opposition political parties are rather weak and under-resourced to provide compelling alternatives to the well-established political dynasties in the country (Timberman, 2019). Due to the patronage and kinship-based political system, public leaders and activists from middle and lower classes have little incentive to join political parties or to work in opposition to the ruling party (The Diplomat, 2022).

The existing parties are based mainly around personal connections and networks, rather than on issues, policy platforms or ideologies. This leads people to vote for individuals rather than for parties, which lack grassroots representation, organisational capacity, and discipline (Bertelsmann Foundation, 2022). As a result, parties and factions dissolve or change their character quickly, leaving long-ruling political dynasties with significant room for manoeuvre to dominate the elections (The Diplomat, 2022).

What is known in the Philippines as “turncoatism”, whereby legislators readily switch parties and political allegiances, is especially widespread in the Congress and in local councils. Congresspeople and local council members from non-ruling parties quickly change their affiliations to join the incumbent president’s ruling party, which holds significant numbers of Congress seats and provincial governorships (Freedom House, 2022). In November 2022, the House of Representatives, a lower body of the Philippine Congress, approved the bill proposed by the former president Gloria Macapagal Arroyo, current Deputy Speaker of the House, to penalise political “turncoatism” (CNN, 2022).

It is also noteworthy that the President appoints the Chairperson of the Commission on Elections (COMELEC), which is in charge of both election management and adjudication. Concerns have been raised over the COMELEC’s independence and performance, especially with regard to its technical operation, procurement practices, and the interpretation of electoral laws (Freedom House, 2022). The Philippines does not provide public funding or free or subsidised access to the media to political parties (International IDEA, 2021). The ability of the opposition to challenge incumbents and win elections is further limited by the campaign finance rules, which put no limits on campaign contributions the significant portion of which comes from a small number of private donors being affiliated with the ruling elites (Freedom House, 2022). Additionally, in 2021, senior government officials from the Duterte government openly “red-tagged” (alleging that an individual harbours communist/terrorist sympathies or connections) members of the House of Representatives, which resulted in their stigmatisation and increased risk of physical attack (Freedom House 2022).

The 2022 elections were no different in this regard. Capitalising on the patronage and kinship-based political and electoral system, described above, the children of former presidents from the Marcos and Duterte families were elected as the President and the Vice-President of the Philippines, respectively (Coronel, 2022).

Bribery

The culture of impunity among the top-level politicians and government officials incentivises the regular public servants to also commit graft, which is mostly manifested in bribery. Patronage-based recruitments in public service, underdeveloped anti-corruption mechanisms, low wages of public servants, and the promise of high returns from engaging in bribery serve as major contributing factors for sustaining this form of corruption in the Philippines government (Batalla, 2020).

As mentioned above, TI’s latest Global Corruption Barometer (GCB) found that the overall bribery rate in the Philippines in 2020 was 19 percent based on responses of public service users. Most respondents paid bribes for the following services: utilities (21 percent); IDs (15 percent); and for services provided by police (18 percent), by public schools (18 percent), and by public clinics and health centres (12 percent) (Transparency International, 2020).

According to a 2018 national survey of the Philippine Statistical Authority and the Office of the Ombudsman, 1 out of 50 surveyed families with at least one official transaction with a government official were asked to pay bribe, mostly for justice and social services and for securing registry documents and licenses (Office of the Ombudsman, 2018).

Based on the analysis of various other surveys and country reports produced over the past few years, accounts of extensive bribery within the Philippines’ public administration system have been disclosed by businesses who were subjected to extortion and manipulation by local public officials. Bribery and fraud are reported to be particularly widespread in the customs and tax administration, public procurement, and the delivery of public services, including the implementation of import and export procedures, public tendering and tax regulations, the registration of civil status and property and the issuance of permits and licenses to businesses operating in the country. The problem of bribery in the public administration creates obstacles for doing business in the Philippines (Gan Integrity, 2020).

As an example, in February 2020, Senator Risa Hontiveros exposed the multi-billion bribery scam called “pastillas” in the Philippines Bureau of Immigration. Under the scheme, the money hidden in rolled bond paper looking like the wrapping for candy was paid to the Philippines’ immigration officers by foreign travellers, mostly Chinese nationals, to avoid background checks while entering the country.In June 2022, the Office of the Ombudsman indicted dozens of immigration officers involved in this scheme (CNN, 2022).

It should be noted that there are cultural practices and traditions in the Philippines that may aggravate the practice of bribery. For example, there is a local political culture of utang na loob which refers to repaying personal favours (Montiel, 2000: 114; Hechanova et al., 2014). Additionally, the cultural norm of Pakikisama, meaning conformity to a group, may also increase the likelihood of corruption (Hechanova et a., 2014).

Strategic corruption

The Philippines has demonstrated vulnerability to strategic corruption, which is the use of corrupt means by foreign governments to increase influence and shape the political environment in a targeted country (Foreign Affairs, 2020). In the most organised form of strategic corruption, “corrupt inducements are wielded against a target country by foreigners as a part of their own country’s national strategy” (Foreign Affairs, 2020).

Chinese nationals and businesses with high stakes in the Philippines’ politics and economy have been particularly prominent in using strategic corruption as a means to increase their influence on and profits from the Philippine economy and to advance their interests in various sectors.

For example, in January 2023, Marcos Jr. endorsed the proposal of the US-blacklisted China Communications Construction Company Limited (CCCC) to build a 270-kilometer highway and to implement other infrastructure and development projects in the Philippines, including bringing China’s Juncao technology (breeding fungi with herbaceous plants) to the country to address soil erosion and desertification. By using the Public-Private Partnerships (PPP) mechanism, the Marcos Jr.’s administration relaxed the rules to allow the CCCC and other foreign investors to bring in their own professionals to encourage technology transfer to the Philippines (Rappler, 2023).

In June 2017, China started investigating bribery allegations against Huang Rulun, a real estate tycoon who donated P1.4 billion (US$24.7 million) to the Duterte government to build two drug rehabilitation centres in the Nueva Ecija province, covering a total area of 100,000 square meters. It is noteworthy that Huang started his billion-dollar business in Manila after leaving China in 1986. He fully supported Duterte’s “war on drugs” and committed to invest more in the Philippines as long as the country “maintains a friendly relationship with China” (Rappler, 2017).

The involvement of Chinese in alleged corruption cases in the Philippines is not new. Back in 2007, China’s Zhong Xing Telecommunication Equipment (ZTE) Corp allegedly bribed senior officials including the current mayor of Mandaluyong as well as the husband of the then President Gloria Macapagal Arroyo, to be awarded a US$ 330 million broadband network contract. The president herself, the House Speaker de Venecia and his son, Romulo Neri, the National Economic Development Authority (NEDA) Secretary and other government officials were also allegedly implicated in the scheme. This project was subsequently suspended based on the testimonies of alleged corruption (Batalla, 2020).

Main sectors affected by corruption

Judiciary and Law Enforcement

The judiciary and law enforcement agencies have failed to bring Duterte and his associates to justice for human rights abuses and corruption offences, perpetuating the culture of impunity and a climate of fear and repression (Freedom House, 2022). The fact that 13 of the 15 seats of Associate Justices at the Supreme Court were taken up by Duterte’s appointees is indicative of how powerful presidents in the Philippines try to hollow out and weaken the independence of the judiciary to ensure favourable judicial rulings (Rappler, 2018 c). Duterte also accused the chief justice, Sereno, of corruption after she spoke up for the respect of law and human rights, leading to her being removed from the top court (CBC News, 2018).

According to local lawyers, all relevant judicial bodies in charge of curbing corruption in the Philippines, including the Supreme Court, the Office of the Ombudsman, and the Commission on Human Rights, are subject to undue influence from the executive. The lawyers also point to the low conviction rates and long trial times in courts as another stumbling block. For instance, the conviction rate during Duterte’s administration was 30 percent. At the same time, the average time for Philippine courts to adjudicate on the case is 15 years, while in some cases court cases have been known to take as long as 29 years (Rappler, 2018 d).

Corruption has also played a major role in weakening judicial independence. The extent corruption is indicated by the high number of cases disciplining judges, court personnel and lawyers, as well as by allegations made by high-profile defense attorney Lorna Kapunan that some justices at the High Court could be bribed (Rappler, 2018 e).

The efficiency of the justice system and the independence of judges is also hampered by low pay, intimidation, corruption, impunity, and high retirement rates. As a result, due process rights of suspects who are critical of the government have often been violated through their arbitrary detention, disappearances, kidnappings, killings, torture, and ill-treatment (Freedom House, 2022).

President Duterte was notorious for suppressing the Congress and the Supreme Court that both have the constitutional power to limit presidential policies. There were cases when Duterte prosecuted critical members of the Congress, and he removed the critical chief justice Maria Lourdes Sereno from the Supreme Court (Bertelsmann Foundation, 2022).

To address corruption challenges within the judiciary, in December 2022, the Supreme Court of the Philippines launched the Judiciary’s long-term reform program: The Strategic Plan for Judicial Innovations 2022-2027 (SPJI). This program is focused on implementing the following guiding principles: timely and fair delivery of justice, transparency and accountability, equality and inclusivity, and technological adaptiveness. Specific activities will include pursuing a campaign for ethical responsibility within the judiciary, strengthening the Judicial Integrity Board, and enhancing public access to information and legal services (UNODC, 2022).

The Philippine National Police (PNP) and the Armed Forces of the Philippines (AFP) have also been implicated in corruption and are regarded as one of the most corrupt institutions in the country. As evidenced above, there are widespread reports about their involvement in the human rights abuses of citizens as well as in torture and summary execution of suspects, extortion, racketeering, and illegal drug trade (Gan Integrity, 2020).

These crimes committed by the PNP and the AFP often go unpunished or are pardoned by the president, which emboldens the police and army officers to commit more crimes. Moreover, the officers who followed Duterte’s orders during the “war on drugs” were promoted through the ranks (Harvard International Review, 2023).

Over the years, the presidents and political clans have used the police to consolidate power, to suppress dissent, and to collect illegal revenues from gambling and drug trade (Coronel, 2017).

Healthcare

Corruption in the Philippine health sector is a long-standing issue as evidenced by a 2008 study by Azfar & Gurgur. The authors concluded that “corruption [in the Philippines] reduces the immunisation rates, delays the vaccination of newborns, discourages the use of public health clinics, reduces satisfaction of households with public health services, and increases waiting time at health clinics” (Azfar & Gurgur, 2008).

More recently, several large corruption scandals emerged in the Philippine health sector during the COVID-19 pandemic. In August 2020, officials of the state-run Philippine Health Insurance Corporation (PhilHealth) operating under the Department of Health (DOH), was accused of stealing P15 billion (US$ 266.2 million) from the agency through various fraudulent schemes, according to the whistleblower disclosure of the PhilHealth’s former anti-fraud legal officer (the Ombudsman has dismissed these charges). This amount included reimbursement funds allocated for 711 hospitals nationwide for their COVID-19 response and for the purchase of information technology systems (CNN, 2021). Some high-level government officers were charged for this fraud. However, in June 2021, the Office of the Ombudsman dismissed those charges (Freedom House, 2022).

Another pandemic-related suspected corruption case involved Pharmally Pharmaceutical Corporation, which was awarded P10 billion (US$177.4 million) worth of pandemic contracts by the Duterte government between 2020 and 2021 to supply Personal Protective Equipment (PPE). Pharmally was a small, newly created company, which, according to Rappler (2021), lacked capacity and track record needed to handle large government contracts. The company was reportedly linked to a Chinese businessman Michael Yang, a friend of and former economic advisor to Duterte, who was allegedly serving as the company’s financier and a guarantor.

This scandal in emergency procurement was first disclosed by the state auditors and then followed up through the congressional investigation into the work of the DOH, which mismanaged P67 billion (US$1.2 billion) of pandemic funds allocated for the purchase of emergency health supplies, equipment, and services (Rappler, 2021 a).

Specifically, according to the Commission on Audit (COA) findings, the DOH spent P6 million (US$106.589) on expired drugs and medicines; P69 million (US$1.22 million) on overstocked, slow-moving or idle drugs and medicines; and P20 million (US$355,297) on nearly expired drugs and medicines (The Philippine Daily Inquirer, 2021). The investigation also revealed that not long after winning the supply contracts, Pharmally executives bought luxury cars, including Porsches and Lamborghinis that cost between P6 million (US$118,000) and P13.5 million (US$266,000) each (Maritime Fairtrade, 2021).

The DOH did not publish details about the purchase of COVID-19 vaccines, most of which related to the Chinese government’s Sinovac vaccine. The congressional investigation was also not able to obtain this information as part of its enquiry due to various confidentiality and nondisclosure agreements. At the same time, Duterte and his Cabinet members reportedly refused to cooperate with the investigation and did not attend the enquiry (Freedom House, 2022). The then Philippine Health Secretary Francisco Duque denied corruption allegations within the DOH (Reuters, 2021).In March 2023, the Office of the Ombudsman suspended 33 past and present procurement service and health officials over irregularities in emergency procurement involving Pharmally as a controversial government supplier (CNN, 2023).

In August 2021, the Alliance of Health Workers, a union of nurses and medical doctors, accused the Philippine Department of Health of corruption since it failed to release the COVID-19 benefits, including the meal, transportation and accommodation allowance, special risk allowance and active hazard duty pay to the Alliance members working on the front line (UCA News, 2021). The Alliance accused the government of pocketing public funds instead of paying health workers (UCA News, 2021).

Natural Resources

With over 7,000 islands, the Philippines boasts vast natural resources and fertile soils, which attract foreign investments. However, the profits generated from those assets often end up serving narrow vested interests rather than the wider population.

Moreover, the land of many ordinary Filipinos is often stolen, and local environment damaged by local clans in order to make way for large business projects in the agriculture, mining, tourism and coal sectors (Global Witness, 2019: 55-56). In the mining sector, for instance, powerful coalitions of politicians,established landowners, and large companies facilitate corrupt practices that allow mining companies to bypass existing regulations during their mining operations, which results in large-scale deforestation, flattened mountaintops and pollution of water and soil (The New York Times, 2017).

For instance, Agusan Petroleum & Minerals Corp. (AGPET) is alleged to have obtained government permit for their mining project in Compostela (Mindanao) through corrupt means. According to the Compostela Farmers Association (CFA), AGPET offered bribes to local community leaders to buy their support for the project. The signatures from those community leaders were then used by the government as evidence of community consent to issuing permit to AGPET for their mining activities in Compostela (Global Witness, 2019).

It has been a common practice in the Philippines that Memorandums of Agreement (MOAs) between government agencies and specific companies are simply transferred from one mining company to another in an opaque fashion. Global Witness (2019) reports that there is often little to no community consent when mining companies’ resource-use and business permits are renewed and the land titling and the land boundary delineation are carried out. In addition, when the mining companies break the terms of their permits they are rarely held to account (Global Witness, 2019).

The government’s National Commission on Indigenous Peoples (NCIP) has been criticised by Global Witness (2019) for failing to adequately respond to community complaints about illegal economic activities on their ancestral land. Affected indigenous communities point to incompetence, under-resourcing, and widespread corruption within the NCIP as the main reasons for its failure to counter illegal logging, mining, and agribusiness activities on indigenous lands. The work of the NCIP is also reportedly hampered by a lack of oversight, transparency, and accountability, resulting in an inability to counter adverse impacts in terms of human rights and environmental degradation (Global Witness, 2019).

For instance, indigenous communities living near Didipio mine started to have water supply problems after the increased water extraction for large-scale mining by the Oceana Gold Philippines, Inc. (OGPI), a multinational company operating a copper-gold mine in Didipio (Business World, 2020).

According to Barrer et al (2017), the Philippines’ forestry and land administration sectors suffer from widespread corruption. It is manifested in bribery, favouritism, extortion, rent-seeking, manipulation of land classification documents, uncompetitive procurement, overpricing, and fraudulent reporting. Public officials from the Department of Environment and Natural Resources (DENR), the police, and the military are implicated in those corrupt practices. Barrer et al (2017) argue that the DENR fails to provide effective oversight over forest management and exploitation due to corruption within the agency (Barrer, et al., 2017).

As an illustration, the Philippines’ richest public official, Jose Alvarez, former Governor of Palawan and a current Congress member representing Palawan, has allegedly been involved in destructive logging, operating rubber plantations, and threatening environmentalists in Palawan’s protected areas. The members of the Palawan NGO Network (PNNI) challenging Alvarez’s activities in protected areas reportedly received threats from the former Governor, followed, and were “red-tagged” (Aspinwall, 2019). Since 2001, 12 members of PNNI have been killed by illegal robbers (Aspinwall, 2019).

Legal and Institutional Anti-Corruption Framework

The Philippines’ national anti-corruption legislation consists of the following key legal documents:

• the Constitution (last amended in 1987),
• the Revised Penal Code (last amended in 2017),
• the Code of Conduct and Ethical Standards for Public Officials and Employees (last amended in 1989),
• the Government Procurement Reform Act (last amended in 2016),
• the Anti-Red Tape Act (last amended in 2018),
• the Anti-Graft and Corrupt Practices Act (last amended in 2016),
• the Anti-Money-Laundering Act (last amended in 2013), and
• the Act Declaring Forfeiture in Favor of the State Any Property Found to Have Been Unlawfully Acquired by Any Public Officer or Employee (last amended in 2014).

In addition, the Philippines is a signatory to the United Nations Convention against Corruption (UNCAC) and a member of the Asia/Pacific Group on Money-Laundering, the Egmont Group of Financial Intelligence Units, and the Asset Recovery Inter-Agency Network for Asia and the Pacific (UNODC, 2023).

There are several notable shortcomings with the country’s legal anti-corruption framework. First, the Philippines does not have a legislation on whistleblower protection in place, making it difficult for witnesses of corruption crimes and human rights abuses to come forward, to cooperate with anti-corruption agencies, and to obtain relevant protection (US State Department, 2022).

There are no legal regulations to criminalise private sector bribery either, encouraging the practice of illicit payments to government officials (Gan Integrity, 2020). As mentioned above, private donors also capitalise on lax campaign finance rules, which allow them to make unlimited contributions to the ruling party candidates during the elections, raising concerns over political corruption (Freedom House, 2022).

At the same time, a long-standing commitment of the Philippine government to adopt a Freedom of Information (FoI) executive order remains unfulfilled, despite the efforts of more than 100 CSOs to raise awareness and to build capacity for the implementation of this. Without a FoI law and relevant obligations, the government can continue to block public scrutiny of important documents, including information on public officials’ assets, liabilities, and net worth; on public expenditures; and on the state programs and projects directly affecting the lives of ordinary Filipinos (OGP IRM, 2022). Moreover, the government has not been forthcoming with the documents that were once possible to obtain before this executive order, such as the President’s Statement of Assets, Liabilities, and Net Worth (SALN), last released in 2018 (Teodoro, 2022).

As for the institutions mandated to tackle corruption, these include:

• the anti-corruption court (Sandiganbayan),
• the Office of the Ombudsman (OMB),
• the Commission on Audit (COA),
• the Department of Justice (DOJ),
• Office of the Deputy Executive Secretary for Legal Affairs (IAD-ODESLA) under the Office of the President,
• the Presidential Commission on Good Government (PCGG),
• the Anti-Money-Laundering Council,
• the Anti-Red Tape Authority (ARTA)
• the Central Bank,
• the Inter-Agency Anti-Graft Coordinating Council (IAAGCC),
• the National Economic and Development Authority (NEDA),
• the Inter-Agency Committee on Good Governance, the Commission on Elections (COMELEC), and
• the Civil Service Commission.

Despite the abundance of bodies in charge of fighting corruption in the Philippines, in practice these bodies are not independent, which hinders their potential role to act as a brake on executive power and hold the president to account for corruption and other abuses. As an illustration, Duterte appointed between 11 to 13 justices to the 15-member Supreme Court, including the chief justice (Ibarra, 2020). While this is the President’s duty to fill vacancies in the Supreme Court, this raised concerns of a lack of independence of the high court and judicial checks, as his appointees consistently voted in his favour (Ibarra, 2020).

The responsible anti-corruption institutions are not equipped to effectively perform their mandates. For instance, the OMB’s monitoring and investigative powers are legally restricted when it comes to examining the bank accounts of corruption suspects or wiretapping them, while the lack of personnel and funds has been a persistent challenge in the Office (Batalla, 2015).

Evaluations of the institutional anti-corruption framework in the Philippines have concluded that successive political administrations have designed a model in which multiple, under-resourced anti-corruption bodies “compete for recognition, personnel and resources” (Transparency International, 2017: 17). The overlapping mandates of these agencies also inhibit effective anti-corruption efforts and result in poor coordination and turf wars (Rappler, 2019).

The Sandiganbayan and other courts are very slow and inefficient when handling corruption cases, the adjudication of which can typically take over six years. This is largely due to the lack of professionalism among judges, high congestion of cases, the lack of resources, inefficient organisational systems and procedures, resistance to change, partiality, and politicisation (Batalla, 2015).

As an illustration, after 30 years of litigation, in December 2019, the Sandiganbayan, dismissed forfeiture cases worth billions of US dollars against Imelda Marcos (wife of Ferdinand Marcos Sr.), and her children who were convicted of graft and ill-gotten wealth (Bertelsmann Foundation, 2022).

While a legal and institutional anti-corruption framework has therefore been established in the Philippines, it is not implemented effectively in practice, allowing public officials to continue engaging in corruption and in the abuse of human rights with impunity.

The legal deficiencies, the lack of inter-agency cooperation and coordination, the lack of independence, capacity and resources within those agencies, and prolonged delays in court proceedings all contribute to a weak public integrity system.

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Civil society

In the Philippines, there are strong and active civil society organisations working on issues such as human rights, social welfare, and the environment. They play an important role in initiating legislation, influencing debates in Congress and local councils as well as in monitoring policy implementation (Bertelsmann Foundation, 2022).

However, the reform-oriented and left-wing organisations or activists who promote human rights and civil liberties and who are usually critical of the government are generally excluded from public decision-making processes. Moreover, they are constantly threatened and harassed by the Philippines’ security forces (Bertelsmann Foundation, 2022). For instance, according to the government’s Commission on Human Rights (CHR), at least 134 human rights defenders were killed under the Duterte administration as of July 2020 (Freedom House, 2022). As a consequence, CIVICUS, a global civil society alliance working on strengthening citizen action and civil society across the world, downgraded the Philippines’ rating from “obstructed” to “repressed” (CIVICUS Monitor, 2020).

In addition to harassment and attacks from the security forces, the Philippines’ civil society representatives are also subjected to legal and financial restrictions imposed on them by the government. For instance, in July 2020, Duterte’s government adopted the Anti-Terrorism Act (ATA), which empowered the Anti-Terrorism Council (ATC) to classify almost all advocacy activities of critical CSOs as terrorism and to designate civic activists and groups as terrorists at the request of other countries or international organisations (USAID, 2022).

This infringed on CSOs’ constitutional rights of freedom of expression, association, and assembly and prompted CSOs to challenge the restrictive law before the Supreme Court for its constitutionality. The Court partially ruled in favour of the CSO petitioners by ruling that defining dissent with intent to cause harm as a terrorist act and designating a person or group as a terrorist based on a request by another country is unconstitutional. At the same time, the Court upheld most of the ATA provisions as constitutional, including the ATC’s discretion to order the arrest of suspected terrorists, to detain them for 24 days and to define the crime of inciting to terrorism in vague terms, putting the right to free speech at risk (Rappler, 2021 b).

In January 2021, the government complicated the CSOs’ registration process by requiring them to disclose additional information on their beneficial owners. Soon after, in June 2021, the government’s Anti-Money Laundering Council (AMLC) froze the bank accounts of nine critical CSOs for their alleged ties to communist rebels and terrorist groups. The affected CSOs were forced to pause their activities (USAID, 2022).

Media

Most of the large and popular media outlets in the Philippines, including GMA Network, ABS-CBN, Philippine Daily Inquirer, Philippine Star, and Manilla Bulletin, are owned by powerful families and business corporations. Some of these outlets avoid criticising the incumbent president’s administration to secure their business interests in the country, while others that are more critical are subjected to government pressure and intimidation.

The Philippines is one of the most dangerous countries in the world for journalists, as measured by the number of journalist deaths. Fourteen unsolved murders were reported in 2022 by the Committee to Protect Journalists (CPJ).

In 2020-2021, Orlando Dinoy of Newsline Philippines and Energy Radio RM, Reynante Cortes, a radio broadcaster, and Virgilio Maganes, a newspaper columnist and radio commentator, who were reporting on local politics and corruption were killed by unidentified gunmen (Human Rights Watch, 2022).

Duterte was notorious for using hostile rhetoric towards journalists, who experienced death threats, physical attacks, cyber-attacks, red-tagging (communist baiting), and smear campaigns during his administration. State agencies have failed to investigate the vast majority of those crimes, raising fears that the culture of violence and impunity for crimes against journalists will continue (Freedom House, 2022).

In 2023, the World Press Freedom Index, measuring the level of freedom enjoyed by journalists and media across the globe, ranked the Philippines 132 out of 180 countries with a score of 46.21 denoting a difficult environment (Reporters Without Borders, 2023)

In June 2022, the National Telecommunications Commission (NTC) of the Philippines ordered internet service providers to arbitrarily block access to 28 websites, including those of independent media outlets, such as Bulatlat, AlterMidya, Pinoy Weekly, GMA Network, and the community paper Northern Dispatch (Amnesty International, 2022).

Other critical media outlets, including the Philippine Daily Inquirer, Rappler, and one of the Philippines’ oldest and most influential TV networks, ABS-CBN, were also targeted by the state authorities. For instance, in May 2020, the Duterte’s government threatened to revoke the broadcasting licence of ABS-CBN, which was subsequently forced to shut down and discharge 5,000 employees following the expiration of its operating license. In parallel, to suppress online criticism and to block alternative news websites, pro-Duterte social media accounts attacked the websites of critical online media outlets and the site of the National Union of Journalists of the Philippines (Bertelsmann Foundation, 2022).

Under the National Security Clearance System and the Human Security Act, the Philippines’ law enforcement agencies are allowed to wiretap journalists based on suspicion of their involvement in terrorism (Freedom House, 2022). Libel and defamation offences are frequently used by powerful politicians and government officials to silence journalists, especially investigative journalists reporting on high-level corruption cases. These politicians and officials are said to offer bribes and other incentives to journalists to make them produce biased reports in their favour (Gan Integrity, 2020).

The grim media landscape, has remained largely unchanged under Marcos Jr.’s administration as evidenced by the killings of critical journalists, by the conviction of cyber-libel against the Rappler founder and the Nobel Peace Prize laureate Maria Ressa, and by the threats against other journalists representing critical media outlets branded as supporters of communists or terrorists (Reuters Institute, 2023).

Business community

Broadly speaking, businesses operating in the Philippines are reluctant to criticise the sitting president given his extensive powers over the country’s politics and economics (Timberman, 2019). In fact, the activities of private business companies are highly dependent on the support of local oligarchs and political clans in the complex, patronage-based system (Freedom House, 2022). This system encourages companies, some of which are owned by or affiliated with local power brokers, to engage in corrupt deals with government officials as evidenced above, especially in the area of natural resources management. The Philippines has been described as a country where crony capitalism flourishes, and in 2021, the wealth of billionaires in the country surpassed 10 per cent of its GDP (de Vera, 2022).

It is noteworthy that according to the 2020 Philippines report of the Extractive Industries Transparency Initiative (EITI), the majority of companies working in the coal, oil and gas sectors with significant contributions to the Philippines’ economy did not disclose their beneficial ownership information despite the DENR’s administrative order requiring them to do so. These companies cite potential harm to their competitiveness and profitability as the main reason for non-disclosure (PH-EITI, 2020).

Faith-based organisations

The Catholic Church is an influential socio-political force in the Philippines. It plays a key role in the country’s public policy debates, despite formal separation of church and state stipulated in the constitution (International IDEA, 2022).

During Duterte’s “war on drugs”, many Catholic bishops and priests were harassed and intimidated by the government for criticising the extrajudicial killings. Furthermore, 16 church members, ministers, and priests were reportedly killed by unidentified gunmen between 2017-2020 (Bertelsmann Foundation, 2022). The churches were prohibited to hold public religious services during the COVID-19 lockdown while Duterte and his supporters were not restricted in holding political rallies (Freedom House, 2022).

In addition, as part of their counterinsurgency missions, the Philippines’ security forces targeted 500 Islamic schools considered as possible recruitment sites for militants. This sparked criticism from Muslim religious leaders and rights groups (Freedom House, 2022).

Academia

Duterte’s government was also hostile towards critically-minded representatives of the academic community. In January 2021, the Armed Forces of the Philippines (AFP) published the names of 27 graduates of the University of the Philippines (UP). They were claimed to be the members of the Communist Party and therefore seen as potential targets of harassment. At the same time, the government terminated the 1989 accord between the UP and the Department of National Defense (DND). This has enabled the PNP and the AFP to enter public universities and arrest anti-government protesters. Duterte’s government also forced four universities to remove all books about communism and “subversive” ideologies from their libraries while 55 indigenous primary schools accused of teaching leftist ideology were closed in the Davao region.