By Kyle Aristophere T. Atienza, Reporter

THE PHILIPPINES remains highly vulnerable to bribery due to the slow rollout of its digitalization program, an industry group said, warning that it prevents small businesses from entering the formal economy.

Despite key developments in the country’s fight against corruption, the problem of bribery persists mainly due to the slow digital transformation push, Philippine Chamber of Commerce and Industry (PCCI) President Enunina V. Mangio said.

“Digitalization efforts have been slow as the infrastructure is still incomplete,” she said in a Viber message. “Perception is still strong that bribery is necessary for securing basic services or for businesses to operate.”

She said businesses usually encounter bribery in securing permits and licenses both at the national and local levels, in dealing with Customs and tax authorities, and in resolving disputes with government contractors.

Ms. Mangio said bribery raises the cost of doing business especially for micro, small and medium enterprises (MSMEs), which account for over 99% of businesses in the Philippines, because they lack the resources to deal with corrupt practices.

“It holds back the growth of enterprises, especially the nano- (cottage) and micro-enterprises that seek to enter the formal economy,” she said. “It deters market competition as only those with enough resources have the capacity to pay off agencies, officials and employees.”

“This leads to higher cost of goods and services and hinders the growth of innovation.”

The Philippines rose eight spots to 111^th out of 194 countries in the 2024 edition of the Bribery Risk Matrix by nonprofit business group TRACE.

While the country’s ranking improved, its overall score fell two points from 54 in the 2023 edition, where the country ranked 119^th. The country kept a “moderate risk” level of bribery.

The Philippines got the highest score in deterrence risk at 75. It received a score of 50 in opportunity risk, 49 in transparency risk and 44 in oversight risk.

Ms. Mangio noted that efforts to curb bribery and other corrupt practices have generally been limited to digitalizing frontline government processes to reduce face-to-face interactions.

Some of the key reforms that may help the country deter bribery include the creation of an Office of the Special Presidential Assistant for Economic and Investment Affairs and Private Sector Advisory Council, and setting up green lanes for strategic investments under a presidential order, she noted. 

“Armed with a direct mandate from the President, they are effective and formidable allies of the private sector in the fight against bribery and corruption.”

Ms. Mangio also noted that the Department of Interior and Local Government’s Seal of Good Local Governance “has been instrumental in upholding transparency and accountability among local governments and in incentivizing good performance.”

The PCCI called for the integration of digital payment in all government services, noting that it should “cover all national and local government agencies and their instrumentalities.”

It sought the passage of a whistleblower protection law “to encourage reporting of corrupt practices without fear of retribution.”

The PCCI said the government should fast-track the creation of online platforms for government contracts, spending and procurement.

The government should also provide the Office of the Ombudsman, Commission on Audit and Philippine Anti-Corruption Commission with better resources and staff training, while giving them “political independence” to be free from interference.

US-BASED nonprofit exploration group OceanX is set to conduct a research mission in the Philippines next year using the world’s most advanced research vessel, as it tries to help the Southeast Asian nation understand the state of its fishery sector and apply for blue carbon credits. 

OceanX, a nonprofit initiative by Dalio Philanthropies, will work with scientists from Philippine universities and government agencies, Chief Executive Officer Mark Dalio said in an interview inside their flagship vessel OceanXplorer, which was docked at the port of Manila on Thursday.

He said they would accept study proposals from Philippine sectors, noting that the open call would focus on the fishery sector and carbon-related studies. Priorities also include coral and deep sea studies.

“The reason why we’re focused on fisheries and biodiversity assessments is that these have a financial impact on countries,” Mr. Dalio said, noting that the sector is a major source of protein — and exports — for the Philippines.

“Using our full genomics laboratory that we have on board, we can kind of understand the health of fisheries in a much more targeted way,” he added.

OceanX would help the country spot areas where there are declines in fishery outputs and understand why it’s happening, he added.

“The research will allow for the countries to have a much more real-time assessment of that. We’ll have long-term benefits in terms of the health of the oceans, but also long-term financial benefits as well.”

For carbon studies, the goal is to come up with data that would help the country “apply for carbon credits,” Mr. Dalio said.

The Philippine Environment department has been pushing legislation that will formalize the Philippines’ carbon credit system.

In May 2023, it signed a memorandum of agreement with Marubeni Corp., DMCI Holdings unit Dacon Corp. and the University of the Philippines Los Baños College of Forestry and Natural Resources for the development of a carbon credit program focused on reforestation.

In November 2023, the Climate Change Commission and Maharlika Carbon Technologies Liability Limited Corp. signed a deal to support efforts to create a national registry that will let the Philippines sell sovereign carbon credits to the global market. 

UNMAPPED SEAS
Mr. Dalio said studying ocean-based carbon credits is relatively “a new concept,” noting that its studies with Philippine scientists would likely “open up new ways of getting carbon credits.”

More than 80% of the world’s ocean remains unmapped, according to Oceana.

“Overall in the entire world, there’s very little known about the deep sea because there are few organizations that have submersibles with remotely operated vehicles,” said Mr. Dalio, who used to be a filmmaker for National Geographic.

“The organizations that have the most knowledge is usually the oil and gas vessels because they are the ones that have remotely operated vehicles,” he added.

Mr. Dalio said OceanX’s flagship vessel was originally an oil surveyor ship. “Because it had all the deep sea capabilities, we took the oil surveyor vessel off the market and we converted it into a science research vessel and then converted it with science labs and other facilities,” he said.

Two of the four vehicles aboard the 87.1-meter OceanXplorer, which uses state-of-the-art optical technology to stream ocean exploration in real time, are manned submersibles that can go as deep as 1,000 meters.

It also has two 6,000-meter remote-operated vehicles. 

“When you get into Southeast Asia, it has some of the deepest seas around this region yet it doesn’t have, let’s say, research,” he said. “It has research vessels, but it’s not an extensive amount of research vessels.”

“So the deep sea is very unexplored overall, and part of what we’re hoping to do is map it, show it, learn more about it, and get more individuals and more organizations and governments interested in doing scientific studies that will benefit the health of the oceans.”

Agriculture Secretary Francisco Tiu Laurel, Jr. said the government hopes that the research by OceanX in the Philippines would “make us understand more how we can repopulate our fisheries, how we can breed, and how we can hatch more fingerlings and fries and all different species.”

“The research that will be done here will be a chance for us to repopulate our fisheries faster,” he said in a fireside chat on the sidelines of the tour of OceaneXplorer at the Manila port. — Kyle Aristophere T. Atienza