September 10, 2025 | Manila
South Korean President Lee Jae-myung has suspended the release of a 700-billion won (₱28.7 billion) infrastructure loan to the Philippines, citing the project’s vulnerability to corruption and mismanagement.
The move comes in the wake of a major corruption scandal in the Philippines involving questionable flood-control projects. Both the House of Representatives and the Senate are currently investigating alleged collusion between politicians and contractors to siphon off funds intended for typhoon-related river management.
President Lee announced the loan suspension through a Facebook post on Tuesday, shortly after South Korea’s newspaper The Hankyoreh published an investigative report.
“The project, which was judged to be of poor quality and prone to corruption, was immediately ordered to stop,” Lee stated, according to the translated post. He added that halting the deal was “significant” as it “prevented the waste of 700 billion won in taxpayers’ money and safeguarded against the risks of corruption and poor governance.”
According to The Hankyoreh, the loan under Seoul’s Economic Development Cooperation Fund (EDCF) was intended to finance the Philippine government’s plan to construct about 350 modular bridges in rural communities. The project had previously been flagged by South Korea’s Ministry of Strategy and Finance as “poorly performing” and vulnerable to irregularities.
The Korean ministry also noted suspicions that corrupt networks in Philippine politics and business were behind the questionable execution of the loan program.
Meanwhile, the Philippine Department of Agriculture announced in June that it would push forward with a ₱27.7-billion initiative to build 300 modular steel panel bridges between 2026 and 2029. These bridges are planned across 52 provinces in 15 regions to connect remote farming communities with larger markets.
The suspension of the Korean loan raises questions about funding sources for the Marcos administration’s infrastructure commitments, as the government continues to face scrutiny over alleged misuse of public funds.
