China Harbour scrutinised in Jamaica

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In Cayman, a hue and cry over ‘good governance’

The Office of the Contractor General in Jamaica drew China Harbour Engineering Company itself into the good governance debate in early June.

In August 2009, Jamaica’s government awarded a US$400 million contract to China Harbour to execute the Jamaica Development Infrastructure Programme on a sole-source basis.
The circumstances surrounding the contract award to China Harbour are the subject of a special OCG investigation.

On 4 June, the OCG released a statement saying it had recently discovered that China Harbour’s parent company, China Communications Construction Company, has been debarred by the World Bank under the Bank’s Fraud and Corruption Sanctioning Policy since January 2009.

The sanctions are related to China Road and Bridge Corporation, and were applied to CCCC when it took over CRBC in 2005. CRBC was debarred by the World Bank for fraudulent practices related to CRBC’s bid for a World Bank-funded project with the government of the Philippines.

While the Jamaican infrastructure programme is not supported by the World Bank, the Jamaican Contractor General questioned whether the Jamaican government had identified CHEC’s debarred status in its due diligence exercises and if that had influenced the decision-making process when awarding the contract.

The Cayman Islands Government is negotiating with China Harbour to build cruise berthing facilities in George Town, improve the Spotts dock area, build a cruise pier near the Turtle Farm and explore cruise facilities in Cayman Brac.

In response to the Jamaican OCG’s statement, the Cayman government said it “does not see cause to believe that CHEC is legally or morally responsible for the actions, which led to the original debarment of China Road and Bridge Corporation by the World Bank”.

According to the Cayman government statement, “there is therefore no indication that valid grounds exist for discontinuing our dealings with CHEC”.