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THE
World Bank (WB) has decided to defer the implementation
of the second phase of the $232-million National Roads
Improvement and Management Project (NRIMP) after the
bank found signs of “procurement problems” in the first
phase of the program.
In a
statement released to media, the WB’s vice president for
East Asia and the Pacific Jim Adams said the decision
has been reached after the bank’s internal
investigations unit found during its investigation that
the bidding for two large road contracts worth $33
million was anomalous.
The
first phase of the NRIMP was implemented from 2000 to
2007 and the WB noted 90 percent of the project’s goals
were achieved. These include the construction or upgrade
of 382 kilometers of road in provinces across the
Philippines and the maintenance of 975 kilometers of
other roads in the country.
“In
2003, however, signs of procurement problems in the
first phase of the program were identified. Between 2003
and 2006, the bank rejected two large road contracts in
three successive rounds of bidding because of strong
signs of collusion and excessive pricing,” said
Adams.
Adams
said the WB’s Department of Institutional Integrity (INT)
launched an investigation into the project after the
bank’s team and “other stakeholders” brought the
information to its attention. The WB official noted that
the Philippines has requested that the bank proceed with
its investigation.
“The
rejected contracts, worth around $33 million,
representing about 10 percent of the total project, were
never financed by the bank,” he said.
A news
item which came out in The Asian Wall Street Journal on
Monday identified China State Construction Engineering
Co. as the firm involved in the anomalous bidding. As of
press time, no comment could be obtained from the
company’s officials.
The news
report also noted that China State Construction won a
$5.6-million contract under the first phase of the
project in 2002. The next year, WB began investigating
leads that the firm had joined a cartel with other firms
to rig bids for two other contracts.
Building
on the experience of the first phase and the lessons
learned from the INT investigation, and in line with the
bank’s governance and anti-corruption strategy, the
Philippine government and the WB team jointly developed
stringent anticorruption measures for the second phase
of the NRIMP.
These
include an independent procurement assessment and
technical audit that strengthens transparency of the
bidding process; enhanced processes for procurement,
financial management, internal controls and audits of
the road management agencies; and inclusion of a new and
innovative coalition of citizen and road user groups
called “Road Watch.”
WB said
Road Watch will monitor project implementation and
procurement and issue periodic report cards on the
performance of the road sector.
Adams
noted that the discussion of the Phase II of the project
at the board has been deferred until the Philippine
government and WB’s board members receive the
information they have requested. |
