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Wednesday, 6 December, 2000, 14:30 GMT
High cost of corruption in Philippines

By regional analyst Nicholas Nugent

In early 2000, the World Bank estimated that corruption was costing the Philippines government $47m a year - or a massive $48 bn over the 20-year period to 1997.

Corruption, said the hard-hitting World Bank report, undermines development, hurts the poor, diminishes the quality of public services and raises the price of goods and services.


There have been a lot of allegations against me these days and I would like to know who these alligators are

President Estrada
The report said private industry shared a responsibility for this state of affairs by its attempts to bribe politicians.

Though the report covered a period before Mr Estrada became president, the former film star turned businessman has himself been named in a number of corruption scandals since entering politics.

He has been accused of blurring the line between business and politics, and bringing the high office of the presidency into disrepute.

Businesses and mistresses

Newspaper reports say he and his close family have interests in up to 68 companies, 11 of them set up since he became president.

Joseph Estrada
Estrada has been open about his closeness to some tycoons
Suggesting that such business activity left him little time to take his political responsibilities seriously, the reports accused him of using the power of patronage to benefit his friends and business associates.

Vote-buying and rewards

But the fact that Mr Estrada so openly admits much of what is alleged about his business and personal life demonstrates the extent to which political patronage of business is widely accepted.

Philippine press
The press have been critical of Mr Estrada's business links
Traditionally, government contracts and appointments are used to buy votes and to reward campaign funding and loyalty.

Mr Estrada makes no secret of his closeness to business tycoons like Lucio Tan of Philippine Airlines and plastics tycoon William Gatchalian, whose financial contributions to his election victory were rewarded with sinecures.

According to a report by the Philippines Centre for Investigative Journalism, about 2% of state employees - about 6000 individuals - were presidential appointees.

They included posts in education and social security as well as senior armed forces officers and employees of two state banks.

The report suggests he used his power of appointment to advance his business interests.

Philippines army
Some senior army officers were found to be presidential appointees
Referring to the president's openness about his use of patronage, the report asks: "How do you deal with a sinner who confesses to his sins with devastating nonchalance?"

Uphill fight

In pushing for the president's impeachment his opponents believed they were furthering a process of political reform begun 14 years ago - when former President Ferdinand Marcos was forced to step after being accused of "fixing" election results in his favour, as well as using his position to enrich himself.

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