BY REGINA BENGCO

FORMER senior government officials yesterday warned the international donor community their assistance to the Arroyo administration is vulnerable to corruption, even as President Arroyo assured international donors her government is tapping both the public and private sectors to ensure the integrity of loan programs.

The warning of the Former Senior Government Officials (FSGO), a group of 90 officials from the Marcos to the Arroyo administrations, was contained in a seven-page open letter read before the international donor community during the opening of the Philippines Development Forum at the Jasmine Function Hall of the Fontana Convention Center in the Clark Freeport Zone in Pampanga.

The letter was read by former national treasurer Leonor Briones during the early morning discussions, a few hours before President Arroyo arrived to deliver her keynote speech.

The forum was attended by officials from the World Bank, Asian Development Bank, International Monetary Fund, and representatives from the United Nations, consultants and civil society organizations.

The FSGO members cited the case of the national broadband network-ZTE deal and the importance of ferreting out the truth regarding the allegations on the alleged $130 million bribes.

"We ask our colleagues in the international donor community to consider how the integrity and effectiveness of their assistance programs to the Philippines could be affected if corruption at the scale and level of the NBN-ZTE scandal remains unresolved. How could the prestige, credibility and leverage of the donor community be constructively mobilized to help Philippine democratic institutions resolve this scandal?"

They also said Arroyo is at the "center of corruption and cover-up" of the deal because she has not taken any action against government officials involved and that she is "using her powers with impunity to stave off the unmasking of her participation in the scandal."

They said up to now, no one has ever owned up to the irregularities surrounding the NBN-ZTE deal, which has resulted in widespread public disgust.

They said Philippine institutions are very weak against corruption which is "so brazen" and has destroyed public trust in government.

Arroyo, in her speech, said her government is taking the issue of corruption "very seriously" and that the 2008 budget has allocated billions for the fight against corruption.

"As an economist, I know that first and foremost, a strong economy is an economy that is transparent and free from corruption. This budget invests more and more to clean up the culture of corruption that has plagued the nation for generations," she said.

"On our part, we will hold officials accountable if they are found to be corrupt after due process," she also said.

Arroyo said she has called on Congress to pass a comprehensive Anti-Corruption Reform Act. She said she has also doubled the budget of the Ombudsman which raised its conviction rate by nearly 60 percent, established the Procurement Transparency Group which is monitoring 40 priority and official development assistance projects, and ordered the creation of watchdog bodies in the Customs and Internal Revenue bureaus.

She asked the creditor community to work with government in standardizing ODA loan conditions.

She said government will apply the targeted spending for ODA in areas such as health programs, reforestation, early childhood education, grade school classrooms, vocational education, high school and college scholarships, teacher training in English, and graduate courses in science, technology and engineering.

Arroyo said the Philippines is at the "tipping point" of moving forward and is "well-positioned" to weather a global economic slowdown.

"The slowing of the economies in North America and Europe is top of mind in our calculations to protect our own economy," she said.

She said the 2008 budget, which is a balanced budget, would play a great deal in this goal by mitigating the effects of the slowdown.