Botswana government awarded billions of pula worth of contracts to construction companies banned by the Word Bank for corruption and fraud – Sunday Standard investigations have revealed.
Botswana’s four most overscheduled contractors, Unik Construction, Zhengtai, China State Construction and China Civil won tenders running into billions of Pula while sanctioned by the World Bank after being found guilty of corruption and fraud.
The four companies which are the only companies operating in Botswana to be blacklisted by the World Bank for corruption and fraud are also the four most over scheduled companies in the country.
Another Chinese company, China National Electric Engineering Company Limited (“CNEEC”) which was commissioned to build the controversial Morupule B project has also been blacklisted by the World Bank, in connection with fraudulent practices as part of the Lusaka Transmission and Distribution Rehabilitation Project in Zambia.
Unik Construction, listed by the World Bank as a Botswana company was between October 2013 and October 2015 blacklisted by the Bretton Woods institution following “uncontested Sanctions Proceedings.” This was after the company was found guilty of fraud in their bid for the Uganda Transport Sector Development Project which was financed by the World Bank.
It has however emerged that while still on the World Bank blacklist, the company bagged a number of contracts in Botswana, among them the USD 28 million (about P300 million) Rasesa to Tshele Hills railway loop; the P180 million Rasesa to Tshele Hills road project and the Francistown Gerald Estate infrastructure project for an undisclosed amount.
The World Bank on 4th October 2013 ruled that, “ Unik (together with any entity that is an Affiliate directly or indirectly controlled by Unik) be declared ineligible (i) to be awarded or otherwise benefit from a Bank-financed contract, financially or in any other manner, 1 (ii) to be a nominated sub-contractor, For the avoidance of doubt, the declaration of ineligibility to be awarded a contract will include, without limitation, (i) applying for pre-qualification, expressing 1 consultant, manufacturer or supplier, or service provider of an otherwise eligible firm being awarded a Bank-financed contract, and (iii) 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 program financed by the Bank and governed by the Bank’s Procurement Guidelines, Consultant Guidelines or Anti-Corruption Guidelines.”
Under the Agreement for Mutual Enforcement of Debarment Decisions, the debarment meant that all signatory multilateral development banks would assess Unik Construction for further blacklisting, including the African Development Bank, Asian Development Bank, and International Monetary Fund. For Countries outside the Agreement for Mutual Enforcement of Debarment Decisions, like the Botswana government, the World Bank provided information on the nature of the findings. “The World Bank refers its investigative findings to concerned national authorities so that they can determine whether or not there is any violation of national legislations and/or the need to conduct their own independent assessment or investigation,” a spokesperson at the World Bank said. The Botswana government however ignored the World Bank’s report and continued to award tenders to Unik Construction.
Unik Construction was delisted from the World Bank list of banned companies in October 2015 after assuring the World Bank that it had taken appropriate remedial measures to address the sanctionable practices for which it had been sanctioned; and that it had adopted and implemented an effective integrity compliance program in a manner satisfactory to the Bank.
However, in December 2019, Unik Construction was mentioned in a fresh corruption controversy surrounding the M340-million tender for the renovation of Lesotho’s Maseru’s Mpilo Boulevard for the Ministry of Local Government.
The Principal Secretary for the ministry, Khothatso Tšooana, told the Lesoth Public Accounts Committee (PAC) that First Lady Maisaaih Thabane and Small Business Minister Chalane Phori instructed him to reward UNIK Construction Engineering with the boulevard tender for assisting premier Thabane.
Tšooana told the PAC that he defied the instruction on the tender award, which has been suspended by Lesotho’s Directorate on Corruption and Economic Offences pending investigation.
Another Botswana government favored construction company, China State Construction Engineering Corporation (CSCEC) which has had a presence in Botswana since 1988 was in January 2009 banned for six years by the World Bank for their alleged effort to rig bids in a major road construction project in the Philippines.
(CSCEC) allegedly colluded with local companies in the Philippines to rig the bidding of the road projects partly financed by the international financing institution, according to a World Bank investigation report in 2009. While fresh on the World Bank blacklist, the Chinese contractor was in 2010 awarded a multi-million Pula contract by Botswana Innovation Hub. This phase of the contract involved the construction of roads infrastructure, drainage and sewerage systems, as well as water and power systems. China State Construction Engineering Corporation (CSCEC) was appointed as construction contractor and Arup BV as facade contractor for
this phase. Construction works on this phase commenced in October 2010 and were completed in December 2011. CSCEC was also awarded a number of construction project by government while still on the World Bank sanctions blacklist.
The third Botswana government favored construction company, Zhengtai Group Co. Ltd was on 5th May 2017 blacklisted by the World Bank together with 20 of its affiliates for a period of 15 months. Curiously, the Directorate of Intelligence and Security Services (DIS) in January 2019 moved to take away a P 1,5 billion tender for the construction of Moshupa Hospital from China Jiangsu International Botswana and swing it to Zhengtai. The tender was closed and adjudicated while Zhengtai was still on the World Bank blacklist.
In his founding affidavit, the Managing Director at China Jiangsu Botswana Cui Wanglin said it is clear and obvious for all that there is a consistent pattern by functionaries of the Ministry to “favour Zhengtai Group Botswana and to legitimise such through official means with a poor attempt to cloth such favours with an element of national security and try to put it beyond the realm of common law review.”
The fourth company on government’s favored list China Civil Engineering Construction Corporation was banned by the World Bank in 2019. The company claimed that it was not among companies blacklisted by the World Bank for fraud.
Contrary to the claim, a World Bank document seen by the Sunday Standard confirmed the blacklisting of the China Railway Construction Corporation Limited (CRCC), the subsidiary CCECC. The World Bank, in the report published on its website named one of the affected companies as CCECC.
China Civil which is the first Chinese company to work in Botswana, came to the country in 1985 to rehabilitate the railway line as an aid project granted by the Chinese government and is widely regarded as the storm trooper of influx of Chinese contractors in Botswana.
The company first made headlines after its then two top managers, Xiaming Wang and Xiaoxiang Qui, were caught red-handed by secret agents as they allegedly bribed former Permanent Secretary of the President, Carter Morupisi, with a cash sum of P25O 000.
Ironically, a UDC member of Parliament complained about the four companies which he suspected of being involved in corruption.
During his response to President Mokgweetsi Masisi’s State of the nation address (SONA) Member of Parliament for Selibe Phikwe Dithapelo Koorapetse charged:.“Let us look at what happens and what appears in our view, to be dubious dealings of corruption or underhandedness on some tenders. Mmamashia-Kanye water tender was awarded to a Chinese company known as Zhengtai Group Botswana at P709 million and 36-months duration. Mr Speaker, the company has been on site for almost six years with an estimated over P1.1 billion cost. Zhengtai has been also awarded the following tenders: Moshupa Hospital; P420 million, Maun Water and Sanitation; P1.8 billion, when it had been P1.4 billion by China Jiangsu, which was elbowed out Okavango Diamond Factory; P220 million, Palapye Botswana Housing Corporation (BHC); P90 million. I am reliably informed that Zhengtai may be awarded Molepolole-Mononyane.
Another Chinese company, UNIK Construction Botswana has been awarded the following jobs: Tutume Water Supply; P230 million, Shakawe Hospital; P400 million, Serowe-Serule road; P420 million, Moshupa Sanitation; P830 million. The most favourite Chinese companies it will appear are these ones; China State, China Civil, Zhengtai and UNIK. What is going on here? Why are these companies winning so many tenders and doing so many jobs simultaneously? We are not against Chinese or foreign companies, but there are Batswana contractors and other foreign companies operating here. Where are they?” asked Keorapetse.
