The Philippines has suffered massive economic losses due to corruption in government flood control projects, with Finance Secretary Ralph Recto estimating damages at over P100 billion since 2023.
Recto emphasized that misuse of infrastructure funds has held back growth and wasted opportunities for development. He noted that if funds had been used properly, the country’s economic growth could have been significantly stronger.
RELATED: [Bigger Than Buildings: Magalong Warns 70% of Infrastructure Funds Lost to Corruption]
Billions in Wasted Public Funds
During a Senate budget hearing, Recto explained that irregularities in Department of Public Works and Highways (DPWH) flood control projects have drained the economy of an estimated P42.3 billion to P118.5 billion over the past two years. He also pointed out that this diversion of resources may have deprived Filipinos of as many as 95,000 to 266,000 jobs.
“It’s possible that our growth would have increased by 6 percent if there was no corruption,” Recto told reporters after the session.
He added that these losses come at a time when raising revenues has already been a struggle. Instead of being invested in beneficial projects, funds were funneled into questionable deals, some of which ended up being “ghost projects.”
Growth Stagnation and Missed Potential
The country’s gross domestic product (GDP) grew by only 5.6 percent in 2023 and stayed at the same level the following year, falling short of the government’s 6 to 7 percent growth target. Recto said this underperformance was tied directly to wasted spending and inefficiencies brought about by corruption.
“We just learned that this is the extent of the problem in flood control. So maybe if that money was spent better, we could have grown better,” Recto said in his remarks.
Recto further underscored the urgent need for tighter oversight, transparency, and accountability in public infrastructure spending, stressing that corruption not only wastes taxpayer money but also robs the economy of momentum at a critical time.
RELATED: [Flood Solution: MMDA Proposes Rainwater Facilities In Camp Aguinaldo]
