The African Development Bank (AfDB) has imposed a one-year ban on Chinese road construction company, China Henan International Corporation Group (Chico), for “fraudulent activity” in a Ugandan project funded by the bank.
The ban, effective March 28th, 2024, prohibits Chico from participating in any new AfDB-funded projects across Africa for twelve months.
This includes an ongoing project in Kenya.
An AfDB investigation revealed that Chico failed to disclose the use of a commission agent during a bid for a road upgrade project in Uganda.
This project, crucial for regional trade with neighboring countries, is part of the bank’s Road Sector Support Project in Uganda.
Chico’s history in Africa raises concerns. The company has faced accusations of abandoning projects, forging land agreements, and fraudulent soil acquisition in Kenya.
Despite funding from AfDB, World Bank, and local governments, some of Chico’s projects in Kenya, Tanzania, and Uganda have been marred by controversy.
The AfDB has taken a stricter stance on fraudulent activity in recent times. Last year, the bank banned five companies, including a Kenyan firm, for corruption in a highway construction project.
Following the ban, Chico and its affiliates will be ineligible for AfDB-funded projects for a year. To regain eligibility, the company must implement a program adhering to the AfDB’s anti-corruption guidelines.