[www.inewsguyana.com] – The Guyana Human Right Association (GHRA) has noted a recent recommendation by a Norwegian Ethic Council to the country’s Finance Ministry urging it not to invest in the China Railway Group (CRG) because of allegations of rampant corruption.
CRG is the parent company of the China Railways First Group (CRFG), which is one of the major contractors employed to conduct works for the completion of the Amaila Falls Project.
In 2012, CRFG signed the contract with Sithe Global for the Amaila Falls project and related transmission lines in a contract worth US$506M.
The end of the year 2014 Council of Ethics Annual Report recommends “the exclusion of China Railway Group Ltd. (CRG) from the investment universe of the GPFG [Government Pension Fund Global] due to the unacceptable risk of the company being responsible for gross corruption.”
The document also details that “CRG operates in countries and sectors that are known to have a high risk of corruption. The building and construction industry, where large public contracts are common, exposes the company to a considerable risk of corruption. It is the Council’s opinion that a company in this given situation is required to have solid systems and measures in place to prevent corruption.”
According toa release from the GHRA, while CRFG is not the company directly referred to in the report, the extensive inter-changing of Directors and CEOs between parent and wholly-owned subsidiary companies referred to in the report has to be a matter of concern to Guyanese authorities and citizens.
It was noted that with the Norwegian government having recently given the green light to the Inter-American Development Bank to facilitate the Guyana Government with US$80 million to serve as equity contribution to the Amaila Falls project, the investment hurdles to this project appear to have been largely overcome.
“However, in light of the deep political divisions around this ambitious project, before contracts are signed, a prudent step would be to hold another round of consultation together with serious due diligence investigations of contracted companies, following general elections in May 2015,” the release noted.