Last week saw an important breakthrough in the talks between the Philippine government and the Moro Islamic Liberation Front, one of two groups fighting for an autonomous Muslim homeland. While details of the draft agreement are still vague, one thing's for sure: for this deal to work, both Manila and the MILF will have to get serious about good governance. If they don't, the southern region could once again descend into violence. And spoilers on all sides abound.

The two sides had been deadlocked for 14 months over the thorny issue of "ancestral domain" -- the territory that will be included in the new autonomous body known as the Bangsamoro Juridical Entity. That body, according to the draft agreement, will assume all local governmental functions for the Moro, the Philippines' largest Muslim ethnic group. While the details are yet to be worked out, Manila would retain control of national issues that affect the region, like defense and monetary policy.

Although the agreement is a step forward, it is far from a comprehensive consensus. The Bangsamoro Juridical Entity overlaps with the five provinces governed under the Autonomous Region of Muslim Mindanao, which established in 1996 by the government's peace treaty with the Moro National Liberation Front (MNLF), another group fighting for an independent homeland. It is now unclear whether the Mindanao autonomous region will be dissolved or superceded by the new entity.

The MNLF already seems dead set against a compromise. Earlier this month, its chairman, Nur Misuari, warned the government not to sign a peace agreement with the MILF. According to the MNLF, the 1996 peace deal is the "final agreement" and it's the MNLF who are the legitimate representatives of the Bangsamoro people. It's now up to both the Philippine government to include the MNLF in the drafting of a New Organic Charter (the BJE's constitution) and help both sides create a common platform for the talks and to establish principles for governance of the area, which is largely located on Mindanao island.

This may be too much to expect from Manila, given the government's track record. The Philippine Congress watered down the 1996 agreement and many provisions of the agreement were never implemented. Assuming that the recent MILF agreement leads to the formal completion of a final peace agreement in 2008, it will still have to be ratified by the Senate, which could be a protracted fight. Congress will also have to pass a host of laws to implement the agreement. The MNLF or sympathetic politicians could file court cases challenging the agreement.

Then there's the problem of corruption. The United States has pledged nearly $50 million to Mindanao upon the conclusion of a peace process. Japan, Canada and the European Union have all pledged significant aid programs, as have the major multilateral financial institutions like the Asian Development Bank and the World Bank. But the MILF's ability to quickly and efficiently absorb the hundreds of millions of dollars that have been pledged is questionable. A master plan for sustainable economic growth and natural resource exploitation must be drawn up immediately.

If there's a bright spot here, it's that the existing draft agreement calls for a referendum for independence to be held in the Bangsamoro Juridical Entity in 2030. This is the Bangsamoro's chance to secure a homeland. But to be successful, their leaders must govern fairly, transparently and honestly; while bringing broad-based economic development. The MILF does not have extensive experience in governance, administration and providing social services. They are all too aware that their pool of human resources is thin. "Nation-building is far more difficult than running a revolutionary organization," the MILF's lead negotiator, Mohagher Iqbal, acknowledged last Thursday.

If the Bangsamoro Juridical Entity cannot overcome the obstacles of poor governance, impunity and corruption that have been the hallmarks of most Philippine governments, the Moro will lose this opportunity. Independence could be won, not through war, but through good governance. Now that would be a revolution.

Copyright 2007 Dow Jones & Company, Inc. All Rights