The African Development Bank (AfDB) has blacklisted a Chinese contractor that has undertaken several multi-billion shilling projects in Kenya over fraud.
The AfDB, which announced early this year that Kenya was set to benefit from a 10 billion Japanese yen (about Sh9.3 billion) medium-term bond the bank raised to help improve access to energy in Africa said Chint Electric, a power transmission and distribution equipment manufacturer, misrepresented its experience in order to meet qualification requirements for several AfDB-funded projects.
“An investigation conducted by the bank’s office of integrity and anti-corruption established that Chint Electric engaged in a multitude of fraudulent practices,” said the AfDB in a statement.
Chint Electric has done business with Kenya Power over the past three years and is also listed as one of the bidders in a Kenya Electricity Transmission Company (Ketraco) project.
The AfDB statement did not, however, say whether Chint Electric engaged in any fraudulent business with the two Kenyan companies.
“In bidding for contracts for numerous AfDB-financed power projects, the company misrepresented with similar assignments in its experience order to meet qualification requirements.”
Value for money
AfDB office of integrity and anti-corruption acting director Bubacarr Sankareh warns that such fraud affects taxpayer’s value for money.
In 2012, Kenya Power contracted Chint for the design, supply and installation of substations in Jomvu and Mishomoroni in Mombasa at a cost of $6.2 million (Sh630 million).
In 2016, Kenya Power contracted the firm for purchase of house service cutouts at a cost of Sh141.3 million and in the same year it was set to complete another contract to install capacitors and reactors at a cost of Sh2.2 billion in 16 Kenyan towns including Chemosit, Eldoret, Lanet, Kisii, Kiambere, Voi, Meru, Nanyuki, Kiganjo, Nyeri, Rabai, Kiboko, New Bamburi and Mtito Andei.
“Procurement under the bank’s rules aims at ensuring optimal value for money for the bank’s regional member countries,” said Mr Sankareh.
“The misrepresentation of a bidder’s qualifications materially undermines this objective and is therefore taken very seriously by the institution.”
During the three years of debarment, Chint will be ineligible to be awarded contracts under any AfDB-financed project or to be a subcontractor, consultant, supplier, or service provider of an eligible firm, said the bank.
The decision will also see other multilateral development banks including the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the World Bank Group blacklist the firm during the period.