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Economy

Italian contractor disowns Sh19bn Arror dam talks

 Noordin Haji
Director of Public Prosecutions (DPP) Noordin Haji. FILE PHOTO | NMG 

Italian construction company CMC di Ravenna has denied being part of negotiations that led to payments of Sh19 billion in connection with the Kimwarer and Arror dams scandals.

The government made advance payments of Sh19 billion, including Sh11 billion in unnecessary debt insurance, Sh4.6 billion as loan interest and other costs, which the Director of Public Prosecutions (DPP) Noordin Haji says was shared out in accounts belonging to the conspirators and their agents.

CMC — which had been contracted to build the two non-existent dams, on Tuesday evening denied any links to those arrangements.

“The accusation would refer, in fact, to the conditions of the financing, by banks of primary international standing, of the public works contracted by Kenya to CMC,” the company said.

“CMC and its representatives did not participate in the negotiations,” the company said, adding it was certain it could quickly clarify that it was not related to the matters under investigation.

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Work on the two dams has not started yet, prosecutors say, an assertion that the company disputes. No land where the dams are meant to be built has yet been acquired, prosecutors say.

CMC di Ravenna has denied any wrongdoing and said in a statement to Reuters that it is co-operating with Kenyan authorities.

Kenyan Finance Minister Henry Rotich pleaded not guilty to corruption charges on Tuesday in connection with the loss of billions of shillings in tenders related to the planned construction of the two dams.

“The company is already working with the Kenyan judicial authority to settle the matter as soon as possible,” CMC di Ravenna said in a statement issued in Italy late on Tuesday.

Kenya was set to seek the extradition of one of the company’s directors to face charges in Nairobi, Mr Haji told Reuters on Tuesday. He said the company had not cooperated with investigators. Prosecutors accuse the company and Kenyan officials of inflating the cost of building the two dams to Sh63 billion from an original cost of 46 billion.

Mr Rotich, who was freed on Sh15 million bail, is one of 26 people facing charges related to the dams project.

“If the projects were carried in adherence to the law and existing policies for safeguarding public interest, then they should not have cost Sh63 billion,” said Mr Haji.

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