Korea Suspends Loan to the Philippines, Philippines Quickly Denies: There Has Never Been One
Amid a corruption scandal and doubts about its investment environment, South Korean President Yoon Suk-yeol suddenly halted a 70 billion won (approximately 358.4 million yuan) infrastructure loan to the Philippines on Friday, citing concerns over corruption. To prevent this move from affecting the Philippines' appeal to foreign investors, the Philippine side quickly denied having reached such an agreement with South Korea.
The Hong Kong South China Morning Post on September 12 quoted analysts as saying that although the Philippines has been vigorously denying it, the actions of major international partners who have withdrawn investments due to concerns over project corruption may prompt other foreign donors and investors to intensify their review and re-evaluation of funding management for projects in the Philippines, especially given the recent public trust crisis caused by a corruption scandal involving flood control projects.
On the local time of the 9th, Yoon Suk-yeol stated on social media that he had ordered an immediate halt to the 70 billion won loan support for the bridge project in the Philippines, as the project "was considered defective and prone to corruption."
However, he added, "luckily, the project has not yet started," and no funds had been disbursed, including the relevant funds established by South Korea for economic cooperation with developing countries.
In his post announcing the news, Yoon Suk-yeol cited a report from the Korean newspaper "Hankook Ilbo." According to the report, the involved project was originally proposed by the Philippine Department of Agricultural Reform, which planned to build more than 350 steel modular bridges across various regions of the Philippines. The country had submitted a loan application to the South Korean government in November 2023.
The report said that the South Korean Ministry of Planning and Budget had previously rejected the loan application due to concerns about potential bankruptcy and corruption in the project. However, at that time, the leader of the People Power Party's parliamentary faction, Kwon Young-seong, intervened to promote the project. In exchange, he obtained the right to mine nickel from the Philippine government.
Because of the above report by the Hankook Ilbo, Yoon Suk-yeol decided to stop providing loans to the project. He said this decision prevented the waste of 70 billion won in taxpayers' hard-earned money, preemptively stopped potential mismanagement and corruption risks, and expressed "deep gratitude" to the Korean media that disclosed the incident.
The South Korean Ministry of Planning and Budget later confirmed that it had decided not to support the Philippines' project.
However, the Philippine Department of Finance denied the existence of the so-called South Korean loan in a statement. The department said that the bridge project is currently being discussed with France, and the negotiations have entered the final stage of technical and financial terms.
Philippine Land Reform Minister Conrad Estrella III also quickly distanced himself through the Philippine Star, stating, "There is no such loan... we have not contacted them, there is no loan agreement," the Philippines only had exploratory talks with South Korea, but due to differences between both sides on the scope and technical details of the project, no loan agreement was signed.
The Philippine Department of Finance also emphasized in its statement that "the Philippine government will meet the trust and confidence of its partners with complete transparency and responsibility."
Original: www.toutiao.com/article/1843102412825604/
Statement: This article represents the views of the author.