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Philippines to investigate alleged road project graft

The Philippines promised yesterday to investigate reports of bid-rigging that led the World Bank to suspend a US$232 million loan for a national road project.

The bank's vice president, Jim Adams, said in a statement from Washington that the lender had rejected two large road contracts between 2003 and last year "because of strong signs of collusion and excessive pricing" linked to government procurement.

The contracts are part of the national roads improvement and management program, which is partly financed by the World Bank and which Adams described as the country's main tool for modernizing infrastructure.

He said bank and government officials have developed "stringent anti-corruption measures" to address anomalies in the bidding process, but that the second phase of the project will remain on hold "until the government and the board members receive the information they have requested."

World Bank spokesman Peter Stephens said that he expects the board to discuss the projects again in the next few weeks because the bank wants "to be sure that all of the safeguards and precautions are in place."

Ricardo Saludo, Philippine Cabinet secretary, said the government was committed to curbing corruption and was working with the World Bank to address the issues of transparency in all projects.

"We expect that anti-graft agencies will look into and act on any solid evidence of corruption," Saludo said.

Philippine President Gloria Macapagal Arroyo has been struggling to shake off the image of a corruption-ridden administration amid several recent scandals.
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