The Embassy of South Korea in the Philippines on Friday clarified that the suspension of a P28-billion official development assistance (ODA) previously in the works between Manila and Seoul had nothing to do with recent domestic issues confronting the Philippine government.
“The suspension of the feasibility study on the project in question is unrelated to the Philippine Government,” the South Korean Embassy said in a statement.
“This decision was made solely to allow for the verification of matters that had been raised in Korean media reports. The project in question will be put on hold until further notice,” the embassy added.
The South Korean Embassy released the statement after President Lee Jae-Myung announced in a Facebook post dated September 9 that he ordered the suspension of the Philippines’ P28-billion loan to “avoid the risk of corruption and mismanagement.”
Some reports quickly connected it to the ongoing investigations related to the flood control corruption scandal, prompting the Department of Finance (DOF) to issue a clarification denying the existence of such loan.
The DOF explained that the P28-billion Rural Modular Bridge Project of the Department of Agrarian Reform (DAR) is currently being considered for funding by the French government, not South Korea.
While the Philippine government often explores financing with multiple partners, the DAR halted discussions with South Korea last year. This decision was made because the project’s scope and technical specifications did not align with the proposed Korean financing, according to DOF.
“The government, as early as the last quarter of 2024, decided to look for other bilateral partners who can implement the full scope of the project,” the DOF said. “Hence, there is no existing loan for the said project with South Korea,” it added.
The South Korean Embassy echoed this position saying: “Despite current circumstances, the Philippines remains one of Korea’s most valued partners, and Korea remains fully committed to advancing development cooperation partnerships between our two countries.”
