Kenya has the second-highest number of projects in Africa that have been sanctioned by the African Development Bank (AfDB) for breaches, underscoring huge concerns about unethical means used to award projects.
Disclosures show the pan-African lender has sanctioned nine projects apiece in Kenya and neighbouring Uganda since 2013, with each country accounting for 11 percent of the total sanctioned projects. Nigeria leads with 12 cases.
The projects in Kenya involve 14 companies and four individuals, bringing to the fore the unethical, fraudulent means that firms have been using to win AfDB-funded projects in the race for billions of dollars.
AfDB says that the offences in Kenya include the submission of falsified financial statements, the submission of forged performance bonds and advanced payment guarantees, forged contract award and project completion certificates, and false contract references.
East Africa accounts for 33 percent of the sanctioned projects, the highest share, which is largely driven by the high number of cases in Kenya and Uganda and is followed by West Africa at 27 percent.
“Although the trend has been consistent in recent years, with the majority of cases originating from these two regions (Western and Eastern), a gap has gradually widened between them due to an increase in the number of cases from the Eastern region,” AfDB says.
The Southern Africa region comes third with a share of 11 percent followed by Central Africa at 10 percent, and North Africa at five percent.
AfDB adds that other offences committed in Kenya include failure by firms to disclose conflict of interest and also not revealing the source country of goods used in some of the projects.
The major sanction that AfDB slaps on firms found in breach of the project terms is debarment, making them ineligible to bid directly or indirectly for any project funded by the lender.
Sanctions may also be imposed on executives of the firms and associated parties. Sanctioned entities and individuals are included in the list of debarred entities available on the Bank Group’s website.
For instance, the bank recently banned a Chinese company, Weihai Construction Group, for fraud in three multi-billion-shilling infrastructure projects in Kenya.
The bank said an investigation conducted by its Office of Integrity and Anti-Corruption established that Weihai engaged in fraudulent practices in the Sh33billion Kenol-Sagana-Marua highway improvement project, phase two of the Nairobi Rivers Basin Rehabilitation and restoration Programme: sewerage improvement project, Phase II, and the towns sustainable water supply and sanitation programme
Some of the Kenyan-based companies also recently banned by AfDB include Aerospace Aviation, Beta Trading Company, Global Interjapan (Kenya) Limited, Eva-Top Agencies, Madujey Global Services, Mactebac Contractors Limited, Techno Brain (Kenya) Limited ("Techno Brain Kenya"), and Sony Commercial Agencies.
Others are Sinotec Co. Limited (Kenya Branch Office), Sino-Kenya Engineering Group Company Limited, Rockey Africa Limited, Reef Building Systems Limited (Reef), Ultimate Engineering Limited, Express Automation Limited, and Kenya Power contractor Chint Electric. Two individuals Mr Yuehua Bai and Mr Joram Opala Otieno are also on the list.
The latest project that AfDB sanctioned in Kenya is the electricity transmission line linking Kenya to Ethiopia and Tanzania where two companies from France and an individual whose nationality has not been disclosed are under probe.
The sanctioned projects in Kenya are in the energy, roads, and water sectors. These projects are the most capital intensive, explaining the unethical means that firms and individuals are using to clinch the deals.
Kenya is the biggest beneficiary of AfDB funding for projects in the region, having received $3.718 billion (Sh478.77 billion) between 2013 and last year, followed by Tanzania with $2.83 billion (Sh366.19billion) and Rwanda with $1.81 billion.
