AfDB debars state-owned China firm for road project fraud in Africa

AfDB debars state-owned China firm for road project fraud in Africa

A China state-owned enterprise was debarred for at least a year by the African Development Bank (AfDB) Tuesday for lying about its past experience.

Chongqing International Construction Corporation (CICO) “engaged in a fraudulent practice” during bids for an AfDB-financed road project in Uganda, according to the AfDB’s Office of Integrity and Anti-Corruption.

The debarment is for a minimum period of twelve months, the bank said.

CICO is part of China’s Chongqing Foreign Trade and Economic Cooperation Group Co., Ltd. and specializes in road building projects in Africa.

On its website, CICO said it “follows the good tradition of ‘honest-being, contract-honoring and promise-keeping’ and has been awarded the Prize of Excellent Construction Enterprise for 5 consecutive years.”

The AfDB said Tuesday that CICO “inflated its purported experience with similar projects, grossly overstating both the scope and the value of contracts it had supposedly successfully completed in the past.”

CICO was required for a tender to show that it had successfully completed at least four similar projects in the previous five years.

It inflated the scope and value of its reference contracts. For example, a contract for a road of 4.4 kilometers was falsely presented as having been 68 kilometers in length.

The value of another reference contract was inflated from about $17.5 million to $79 million.

The AfDB’s Bubacarr Sankareh said CICO will remain debarred “until the bank is assured that it is not putting funds at risk by doing business with this company.”

To be reinstated, CICO needs to adopt “a comprehensive integrity compliance program that meets the standards of the AfDB.”

The bank said it will “verify the adequacy of CICO’s compliance framework” before the company is released from debarment.

The African Development Bank Group or Banque Africaine de Développement is based in Abidjan, Côte d’Ivoire. It has 80 member countries and about 1,850 staff. FCPAblog