Chinese companies in Zim blacklisted internationally

Source: Chinese companies in Zim blacklisted internationally – The Zimbabwe Independent June 24, 2016

ZIMBABWE has become a haven for dodgy and corrupt companies amid revelations that China Jiangsu International Economic and Technical Co-operation (CJI), a firm contracted by government to undertake the refurbishment and expansion of the Harare International and Victoria Falls airports, was blacklisted by the World Bank and African Development Bank for fraud and corruption.

By Herbert Moyo

The company, which is eyeing a number of construction projects, is part of several dubious companies operating in the country.

Another Chinese company, China Harbour Engineering Company Ltd (CHEC), which was awarded a tender for the dualisation of the US$2 billion Beitbridge-Harare-Chirundu highway, was also blacklisted by the World Bank for fraud and corruption.

The revelations come at a time there is controversy over the country’s energy deals, which were inflated by more than US$500 million, raising suspicions that Zesa senior managers and top government officials could have corruptly benefitted through the price escalations.

Some projects were awarded to shady businesspeople, including the US$200 million 100 megawatt Gwanda Solar Project, which was given to Wicknell Chivayo’s Intratek despite losing out on the original tender.

Chivayo is a convicted fraudster and his partner, Ibrahim Sildky Yusuf, a Zambian based in South Africa, has a well-documented history of drug trafficking, money laundering and theft by fraudulent means. Yusuf is founder and executive chairman of the Intratek Group of companies, which owns Intratek Zimbabwe (Pvt) Ltd where Chivayo is listed variously as “managing director”, “director” and “representative”.

An investigation by our sister paper in South Africa Mail&Guardian, revealed Yusuf was “linked to a Zambian mandrax smuggling network in the mid-1980s and named in a 1985 Zambian court judgment”.

The paper also received a document on Yusuf prepared by the Zambian Drug Enforcement Commission, which confirmed that that he had been arrested in July 1989 in connection with the unlawful importation of vehicles and trafficking in mandrax and again in December 1997 in connection with money-laundering and illegally importing vehicles.

Documents from the World Bank seen by the Independent this week show that CJI was blacklisted by the Bretton Woods institution from February 14 2014 to February 13 2017. The company was blacklisted for submitting false information to the bank when it bid for a construction contract for the Ethiopia Irrigation and Drainage Project.

“The specific accusations made by the bank’s integrity vice-presidency (INT) in the SAE were that the respondent (a) submitted a false corporate experience claim in a pre-qualification application for a construction contract and in a later bid for that contract; and (b) submitted false personnel experience claims in two bids for that contract,” the World Bank stated in its 2013 document titled Sanctions Case No. 294.

The document was signed by Pascale Helene Dubois, the chief suspension and debarment officer at the World Bank.

The bank consequently recommended that CJI be declared ineligible to be awarded or to benefit from a “bank-financed contract and to be a nominated sub-contractor, consultant, manufacturer or supplier, or service provider of an otherwise eligible firm being awarded a (World) Bank-financed contract”.

“CJI be declared ineligible to receive the proceeds of any loan made by the bank or otherwise to participate further in the preparation or implementation of any project or programme financed by the bank and governed by the bank’s procurement guidelines, consultant guidelines or anti-corruption guidelines; provided, however, that after a minimum period of ineligibility of three years.”

The bank further stated that it reached its decision after taking into account that CJI engaged in a “repeated pattern of misconduct by submitting fraudulent documentation”.

The bank, however, noted that CJI had agreed to meet the bank officials and acknowledged that the fraudulent practices had occurred.

The sanctions are also supposed to be enforced by other multilateral development banks (MDBs), including the African Development Bank Group, the Asian Development Bank, the European Bank for Reconstruction and Development and the Inter-American Development Bank Group.

Last month, CJI said it was nearing the completion of the expansion project of Victoria Falls International Airport with preferential loans provided by the Chinese government.

“Currently, 97% of the total work has been completed, including the construction of runway, terminal, control tower, parking apron, light navigation, communication system and other facilities.

“On December 1 2015, it was put into service by the Civil Aviation Authority of Zimbabwe and has been highly spoken of by all sectors of society in Zimbabwe,” CJI stated in an interview in China with the state media.

“Guided by the principles of President Xi Jinping’s visit to Zimbabwe and the Johannesburg summit of the Forum on China-Africa Co-operation, we will increase input in the infrastructure of Zimbabwe and expand our co-operation and try to launch projects in the mode of BOT (Build Operate and Transfer) or PPP (Public-Private Partnership) when Zimbabwe faces financial problems.”

On Wednesday, Transport minister Joram Gumbo said he was unaware of the CJI blacklisting, adding they won their contracts before he became minister.

“I know nothing about that because l had not been appointed minister then,” Gumbo said.