Public spending in Philippines stalls amid fight against graft

Manila

THE Philippines ended 2014 with its weakest economic report in almost three years as moves to curb graft and check abuse of power at all levels of government deterred public spending. President Benigno Aquino now faces the challenge of convincing officials to unclog the logjam.

China's anti-corruption crackdown led officials to slash luxury spending and entertainment. In the Philippines, a similar drive saw civil servants delaying projects as varied as rail lines, fishing ports and free chickens for the poor, according to budget officers. About US$1.85 billion, or 15 per cent of planned state spending, went unused in the third quarter, government data show.

"Officials are now gun shy," Budget Secretary Butch Abad said in an interview last month. "They take a while before they sign papers, and if there are issues, they would prefer not to proceed. There is an air of uncertainty hanging over our heads." The challenge is preventing the fallout from spreading to other sectors of the South-east Asian nation, as Mr Aquino cleans up the bureaucracy to boost investment and propel expansion beyond the end of his term next year. While the president has turned the Philippines into one of the region's fastest-rising economies in recent years, growth will probably slow to about 6 per cent in 2014 and this year, from more than 7 per cent in…