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dam-l Lesotho corruption-another story from Lesotho NGOs/LS

This appeared in the Sept/Oct edition of "Work for Justice", the
publication of Transformation Resource Centre in Maseru.

On 28 July, 1999, Masupha Sole was charged with accepting R12million in
bribes from twelve large international companies in exchange for favourable
contract decisions while he was chief executive of the LHDA from 1986-1995.
Sole, however, will not be the only person in the dock when his trial
begins.  If Sole is found guilty, the twelve companies who offered him
bribes may face severe disciplinary action as well.  Unfortunately, legal
loopholes could also let them go scot-free.

Many of the companies listed in Sole's charge sheet (Impregilo, Spie
Batignoles, Sogreah, LHPC Chantiers, Dumez International, Acres
International, ABB, Diwi Consulting, Highlands Water Venture, LHPC, ED
Zueblin, and Lahmeyer Consulting Engineers) are involved in dam
construction projects throughout the world.  These projects often receive
funding from the World Bank.  World Bank policy dictates that any
contractors discovered to be involved in corrupt activities will be barred
from working on World Bank-funded projects.  According to the Bank's
procurement guidelines,  "The bank will declare a firm ineligible, either
indefinitely or for a stated period of time, to be awarded a bank-financed
contract if it at any time determines that the firm has engaged in corrupt
or fraudulent practices in competing for, or in executing, a bank-financed
contract."

The implicated companies may face criminal charges in their home countries
too.  All of the companies implicated in the bribery charges are based in
countries that have signed the Organization for Economic Cooperation and
Development (OECD) convention on corruption and bribery which obliges
signatory nations to adopt legislation that outlaws bribery of foreign
public officials.

But as so often happens throughout the world, multinational corporations,
governments, and international lending institutions work together to
protect their own interests; no matter how corrupt.  The World Bank has
already hinted that the companies will not face Bank sanctions (despite its
President, James Wolfensohn's, high profile anti-corruption campaign)
because the bribes did not involve components of the project financed by
the Bank.  The OECD convention may not have any real teeth either.
Although all involved countries have signed the convention, some (notably
Switzerland) have not yet ratified it.  Others, like Canada, have not made
laws that would apply retroactively or that would apply to an act of
bribery occuring in a foreign nation.  So, even though Spie Batignolles,
Sogreah, Impregilo, Dumez, Lahmeyer, and ABB have been repeatedly
implicated in corrupt practices in dam projects everywhere from Kenya to
Guatemala, they may escape without any real sanction.  Masupha Sole, one
hapless, greedy man, will be the scapegoat of the entire corrupt system.

This is not fair according to Dr. Peter Eigen, Chair of Transparency
International.  "Both bribe payer and recipient are defrauding the public,
wasting resources and hindering development," he says.  "There is no doubt
that the international firms involved deserve censure."

The Coordinator of Highlands Church Solidarity and Action Centre (HCSAC)
Thabang Kholumo is outraged that the World Bank may avoid disciplining the
involved companies.  "It is ridiculous to claim that the bribery is not
connected to World Bank-funded components of the project," he said.  "I
don't care if the Bank gave monitoring support, human resource support,
spiritual support or whatever.  This is a World Bank project and those
(implicated) companies would not be working on the LHWP without Bank
involvement."

TRC's acting coordinator Motseoa Senyane said, "If it is proved that those
companies bribed Sole, they should be expelled from their work at Mohale
(Dam)."

"I want to know if these corrupt practices affected the water royalty
amounts," added Kholumo, "bribery hurts all of us."

Any disciplinary action against the firms hinges on the outcome of Sole's
trial in the High Court of Lesotho which has been postponed from 31 August
to an as yet undetermined date.  The world will be watching to see if the
rich and powerful will be held accountable for their corrupt practices.

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      Lori Pottinger, Director, Southern Africa Program,
        and Editor, World Rivers Review
           International Rivers Network
              1847 Berkeley Way, Berkeley, California 94703, USA
                  Tel. (510) 848 1155   Fax (510) 848 1008
                        http://www.irn.org
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