THE Philippines has withdrawn its application for a second compact with the Millennium Challenge Corporation (MCC), Malacañang announced on Tuesday, December 19.

In a press conference, Presidential Spokesperson Harry Roque Jr. said the Duterte administration needs to focus on rehabilitation efforts in Marawi City.

"By way of final announcement, we have opted to withdraw from the second millenium challenge," Roque told Palace reporters.

"The decision to withdraw was because of the urgent priority of the administration to rebuild Marawi," he added.

MCC is an independent United States foreign aid agency that provides grants to promote economic growth in poor countries that are committed to good governance, economic freedom and investments in citizens.

The Philippines Compact, approved in 2010, was a five-year $434-million grant that supported reforms and investments to modernize the Bureau of Internal Revenue, expanded and improved the community-driven development project Kalahi-CIDSS, and rehabilitated a secondary national road in Samar province.

The Philippines has been listed as a "candidate country" for a second compact or grant.

Based on the MCC Fiscal Year 2018 scorecard, however, the Philippines failed to meet the performance standard as it received low scores in controlling corruption and ensuring rule of law.

Roque said the Philippines would not apply for MCC's second cycle of grants until the government is able to gain traction in rebuilding Marawi City.

"It was really just that Marawi happened. We did not expect it and it's going to be a very costly rebuilding," he said. "For the time being, we will withdraw our application for the second cycle, and we will focus instead on the rebuilding of Marawi."

Marawi was devastated by a five-month battle between government troops and the Maute terrorists, who laid siege to the city on May 23 after security forces failed to arrest terrorist leader Isnilon Hapilon. Defense authorities declared an end to the armed conflict on October 23.

Roque said the Duterte administration remained optimistic that the US government would continue to support efforts to restore law and order in Marawi, despite this decision to withdraw the application for MCC's second compact.

"We have invited the US government's continued support and assistance for the reconstruction of Marawi," he said.

"We're confident that the US government fully understands our decision to relocate our fund priority for this year, and that will not, in any way, adverse the impact or eligibility for another round of compact assistance in the future because it calls for counterpart financing as well," he added. (SunStar Philippines)