MANILA, Philippines — Corruption is a pervasive and long-standing problem in both the public and private sectors in the Philippines, according to the US State Department’s latest annual investment climate report.
The Philippines ranked 114th among 180 countries on Transparency International’s 2024 Corruption Perceptions Index, a rank it has held since 2019.
The State Department report cited observations from various organizations, including the World Economic Forum, placing “corruption among the top problematic factors for doing business in the Philippines.”
Last February, the Financial Action Task Force (FATF) removed the Philippines from its grey list, citing the country’s progress in strengthening measures on anti-money laundering and in combating financing of terrorism.
The State Department’s Investment Climate report is intended to help US companies make informed business decisions by providing up-to-date information on the investment climates in more than 170 countries and economies.
It is prepared by economic officers stationed in diplomatic posts around the world.
In the Philippines, stakeholders report inconsistent regulatory enforcement. Some US investors describe business registration, customs and immigration processes as burdensome.
The report identified the Bureau of Customs as one of the most corrupt agencies in the country.
Customs processes, in particular, can present challenges, with the US embassy in Manila receiving reports from US businesses about overly invasive searches, inconsistent customs charges and solicitations of “facilitation fees” or bribes by some customs officials.
The report also noted the Philippines’ complex, slow, redundant and sometimes corrupt judicial system, which inhibits the timely and fair resolution of commercial disputes.
Foreign investors describe the inefficiency of the judicial system as a significant barrier to investment. Investors often do away with filing cases in court because of slow and complex litigation processes and fears of corruption.
In 2003, the Philippines ratified the United Nations Convention Against Corruption, the only legally binding universal anti-corruption instrument.