NIB on the spot for controversial Sh. 19 Billion dam tender to blacklisted Chinese company

Another Sh.19 Billion scandal unearthed in government

May 11, 2019 1:01 PM

Initial cost had been inflated by Sh11 Billion, tender awarded to blacklisted Chinese firm

DCI Headquarters along Kiambu road. The agency has been at the forefront in the onslaught against corruption with the most recent one being the dams scandal

In what is becoming a familiar trend in Kenya, a scandal in which a Chinese company blacklisted by six multilateral development banks (MDBs) was controversially awarded a Sh.19 billion tender with significantly inflated costs has been unearthed.

At the center of the controversy is the China International Water and Electric Corporation (CWE) that was awarded a Sh19 billion tender to construct Lowaat Dam in Turkana County by the National Irrigation Board (NIB).

The scandal, full of suspect dealings began in July last year when NIB decided to award the CWE the tender despite the fact that it had initially lost the bid to Sinotec Company.

Equally suspect is that despite CWE quoting Sh.17.9Billion shillings, NIB went ahead and fraudulently increased the bid by 11 Billion shillings as was established by the Public Procurement Administrative Review Board (PPRB).

NIB CEO Gitonga Mugambi (left) Pulse Live Kenya

Having lost the tender to Sinotec, CWE appealed the award at the PPRB which annulled the tender and directed NIB to conduct fresh evaluation on June 14.

However, this was never to be the case. In a strange twist of events, NIB informed CWE it would get the award to construction of the dam at Sh18.5 billion instead of calling for a fresh tender as ordered by the review board.

Once more, NIB reviewed the cost upwards by 600 million shillings to 18.5 Billion from the 17.9 billion quoted by CWE.

Despite the controversies, the increased costs, the glaring loopholes and failure to comply with the directive by PPRB, NIB’s managing director Gitonga Mugambi insisted that everything is above board.

Nation quoted Mugambi insisting that “There is absolutely nothing wrong with the tender”.

Bribing tender committee with Sh120 Million

NIB CEO Gitonga Mugambi Pulse Live Kenya

The firm is not new to controversy and is often cited as a perfect example of how Chinese companies are elbowing their way into lucrative contracts in Africa by hook and crook.

In September 2014, the World Bank found CWE guilty of fraudulently winning dam construction contracts in South East Asia and Africa.

Uganda cancelled a $1.6 billion (Sh161.6 trillion) tender the company had won in 2012 for the construction of the 660MW Karuma hydropower project after it was established that the tender committee had been bribed with Sh120 million.

The scandal comes hot in the heels of the controversial Kimwarer and Arror dams scandal in which the public reportedly lost Sh 21 Billion.