The flood control corruption issue in the Philippines has no impact on ongoing free trade agreement (FTA) negotiations with the European Union (EU), a top official said Thursday.

“It is not affecting,” Delegation of the EU to the Philippines Ambassador Massimo Santoro told reporters on the sidelines of a Stratbase-organized event in Makati City, saying the government is investigating the case and that accountability is an essential background for investors.

“We know that the corruption issue on the misuse of flood control funds has been tackled. There is action by the government. There is clearly a willingness to ensure accountability,” he said. “It had no specific impact on the current FTA negotiations."

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“The two sides are very well aware of how much the fight against corruption is, not only in the framework of the FTA, but also in the framework of the current system, of the generalized system of references between the EU and the Philippines. It is a general issue of good governance that the two sides share,” he added.

Santoro said confidence in the Philippine market remains strong despite the controversy, adding that the flood control corruption issue “was never a concern.”

“We see that there is action by the government. It was the President himself who identified the issue during his State of the Nation Address. He identified it and took concrete action against it. [W]e never had a concern that this would impact,” he said.

The EU and the Philippines are currently in the fourth round of FTA negotiations, which took place in October.

Chief trade negotiator Allan Gepty said the agreement could become the country’s “most comprehensive FTA” once completed, covering intellectual property, competition, government procurement, and trade-related sustainable development, including labor rights, environmental protection, and good governance.