A United States aid agency has deferred the selection of the Philippines to receive a multi-million dollar development grant, citing concerns on “rule of law and civil liberties.”

The Millennium Challenge Corp last year said it had unanimously re-selected the Philippines to get a second grant due to the country’s improvement in good governance under then President Benigno Aquino III.

The formal re-selection of the Philippines by the MCC was supposed to succeed the first grant or compact of $434 million that expired at May 2016.

In a statement, the MCC Board said it had “deferred” a vote on the re-selection of the Philippines for compact development, “subject to a further review of concerns around rule of law and civil liberties.”

The Department of Foreign Affairs said the MCC’s decision is not yet final, saying “the development of the Second Compact continues until the next board meeting in March 2017.”

“The deferment allows us the opportunity to continue to dialogue with the MCC,” it said in a statement on Thursday as it assured the Washington-based agency that the Philippine government “remains committed to the goals to foster good governance and the rule of law in the country.”

It said it will continue to engage the MCC Board “to ensure that accurate and updated information on government policies and programs are provided to its members.”

“The MCC Board had a wide discussion on its engagement with the Philippines, including the very positive performance in the First MCC Compact and the FY 2017 Scorecard, as well as on the current developments in the country,” the DFA said.

US Embassy spokesperson Molly Koscina explained the MCC did not actually reject the Philippines.

“The Board did not vote on whether to reselect Philippines as eligible to continue developing a second compact at the December meeting. Rather, it decided to revisit the discussion on the Philippines’ eligibility at a future date,” Koscina said via e-mail.

“MCC will continue to monitor unfolding events in the Philippines and underscores that all country partners are expected to maintain eligibility, which includes not just a passing scorecard but also a demonstrated commitment to the rule of law, due process and respect for human rights,” Koscina said.

Approved in 2010, the first grant of the Philippines was $262 million for the Secondary National Roads Development Project to improve routes to markets and services for farmers, fishermen and small businessmen.

It gave $120 million for poverty reduction programs and $54.3 million for streamlining business processes of the Bureau of Internal Revenue and reduce corruption under the Revenue Administration Reform Project. DMS