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dam-l European Cos Charged With Bribery In Lesotho Dam Project/LS (fwd)

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From owner-irn-safrica@netvista.net  Thu Nov 18 12:31:20 1999
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Date: Thu, 18 Nov 1999 09:28:55 -0800
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From: lori@irn.org (Lori Pottinger)
Subject: European Cos Charged With Bribery In Lesotho Dam Project/LS
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>November 18, 1999
>Dow Jones Newswires
>European Cos Charged With Bribery In Lesotho Dam Project
>JOHANNESBURG -- At least nine European construction companies have been
>charged with bribery by the Lesotho government over their involvement in an
>$8.0 billion dam and tunnel project in southern Africa, the acting director
>of public prosecutions with the Lesotho government said Thursday.
>The companies were served with summonses over the past week to appear before
>the Maseru Magistrate's Court on Nov. 29 on charges of allegedly bribing the
>head of the government agency overseeing one of the largest civil
>engineering projects in Africa.
>The European companies identified are Swiss-Swedish conglomerate ABB AB
>(ABBBY), Impregilo SpA (I.IPG) of Italy, Dumez International, Sogreah, Spie
>Batignolles, Cegelec and Coyne & Bellier of France, Lahmeyer International
>of Germany, and Sir Alexander Gibbs & Partners of the U.K.
>Other companies charged include Acres International of Canada, Universal
>Development Corp. and Electro Power Corp. of Panama and Concor Ltd. (O.CNC)
>and Group Five Holdings Ltd. (O.GHO) of South Africa.
>Three individuals were also charged.
>The names of the companies and indivduals charged were confirmed by Leaba
>Thetsane, acting director of public prosecutions with the Lesotho
>Lesotho is an impoverished, nominally independent country entirely
>surrounded by South Africa, but rich in water resources.
>The charges follow a five-month probe into irregular payments allegedly made
>between the companies and Masupha Sole, the former chief executive of the
>Lesotho Highlands Development Authority.
>The LHDA oversees the Lesotho Highlands Water Project, which is damming the
>country's abundant water resources and tunneling them north to the
>industrial heartland around Johannesburg. The multi-phase project is
>scheduled to be completed by 2017.
>Sole was convicted in a civil court last month of taking bribes and must pay
>back between $1.25 to $1.80 million.
>He is also expected to appear at the magistrate's court on Nov. 29 to face
>further charges related to allegations that he pocketed $2.0 million in
>bribes over a 11-year period ending Dec. 1998.
>Impregilo Denies Bribe Payments
>Thursday an official at Impregilo confirmed that his company is facing
>bribery charges, but quickly denied any payments were made.
>Officials at ABB in Switzerland didn't return calls.
>The World Bank, which has loaned $150 million to the water project, met with
>Lesotho government officials this week.
>Pamela Cox, the World Bank's country director for South Africa and Lesotho,
>said her organization is eager to provide financial and technical assistance
>to the case.
>The World Bank is anxious to be involved in uncovering and prosecuting
>alleged acts of corruption where its funds are involved. President James
>Wolfensohn is keen to overturn an image as a lender that turns a blind-eye
>to financial impropriety.
>"We're very impressed that the Lesotho government is leading this case,"
>said Cox.
>The bribery charges over the Lesotho Highlands Water Project are just the
>latest in a string of investigations into Third World dams financed by the
>World Bank and other multilateral lenders.
>These include Turkwell Gorge in Kenya, Chixoy in Guatemala, Tucurui in
>Brazil, Itaipu on the Brazil-Paraguay border and Yacyreta, on the border
>between Argentina and Paraguay.
>Anti-corruption organizations like Berlin-based Transparency International
>are demanding the World Bank suspend companies implicated in such scandals,
>and to permenently blacklist them if they are found guilty of having paid
>Many of the international construction companies alleged to have paid bribes
>in the $2.4 billion first phase of the Lesotho water project are working on
>the second phase.
>Lesotho government officials said they wouldn't speculate on what the status
>of these companies would be if found guilty of paying bribes.
>   -By Michael Wang; +27-11-726-7903;
>(Fred Kapner in Milan and Dennis Baker in Zurich contributed to this story.)
>Please note new address and fax number:
>Ross Hammond
>965 Mission Street, Suite 218
>San Francisco, CA 94103
>tel. 1-415-695-7492
>fax. 1-415-369-9211

      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