The second phase of the tender for the Windhoek-Hosea Kutako International Airport road has placed the Ministry of Works Executive Director Willem Goiemann, in one corner and the Roads Authority board in the other.
The two are recommending different construction companies to the African Development Bank (AfDB), who are the co-financiers of the project.
The road agency's board recommended that the tender be awarded to a Chinese state-owned company, Zhong Mei Engineering Group, which ranked seventh in the tendering process.
The RA board’s recommendation came after it had rejected a recommendation by the Bid Evaluation Committee to award the tender to another Chinese company, Aviation Industry Corporation of China (Avic International), which had bid for N$950 million.
Roads Authority board chairperson Brian Katjaerua wrote to Works minister John Mutorwa on 02 September expressing his dissatisfaction with the decision taken by Goiemann to recommend China State Construction Engineering Corporation to the African Development Bank (AfDB).
Katjaerua said when the Roads Authority Board wrote to Goiemann informing him of their decision to award the tender to Zhong Mei Engineering Group, the works executive director did not disagree with their findings neither did he express any misgivings.
“RA wrote to the executive director, as procedures dictate …to advise him of our findings and to kindly request that he transmits these findings to the AfDB for a no-objection. He did so and we did not get any sense (written or otherwise) of the ministry’s disagreement with our findings at this stage or the executive director’s overarching role or powers to overrule the board,” Katjaerua said in the letter to Mutorwa.
Despite not objecting to the decision by the RA Board to award the tender to Zhong Mei Engineering Group, Goiemann wrote to the continental bank recommending that China State Construction Engineering Corporation be given the tender.
Goiemann stated that China State Construction Engineering Corporation scored the highest technically behind Avic International and could have been the next recommended bidder after the latter’s bid was rejected for being “abnormally low.”
He said there is no evidence to support the concerns raised by the Roads Authority nor was there any historical non-performance certified by the authority to support its argument.
“Contrary to the above, the Roads Authority awarded the bidder the completion certificate on previous projects awarded,” he said.
As a result, Goiemann recommended that the bank should not object to the tender being awarded to China State Construction Engineering Corporation, which was the lowest bidder in price and had scored second highest technically.
Documents seen by this newspaper show that the Roads Authority is not amenable to China State Construction Engineering Corporation getting the tender.
According to the authority, the company performed poorly in another road project.
“Further owning to its poor performance on previous Roads Authority projects, the board of directors considered China State Construction Engineering Corporation a high technical risk”.
China State Construction Engineering teamed up with former president Hifikepunye's Pohamba's daughter, Kaupomhote Pohamba, for the road project in question.
The RA report claimed that the joint venture failed to complete that project on time, compromised quality, and delayed the project.
In the letter to Mutorwa, Katjaerua reminded the minister of a clause in the loan agreement signed between the government and the continental bank, which states that the Roads Authority is responsible for the day-to-day implementation of the project including procurement of goods, works, and acquisition of consulting services.
Katjaerua said it is against this background that the Roads Authority assumed the overall responsibility to implement the project, including procurement.
“To the surprise of the Roads Authority management and board, it was discovered after the closing date for companies to tender that the ministry had taken over the bid evaluation process.
In its defence, the ministry argued that their powers as the executing agency meant that they were tasked with bid evaluations and recommendations to the AfDB.
Katjaerua said to Mutorwa that the confusion of roles between the Roads Authority and the line ministry could result in unprocedural procurement coordination or ‘mis-procurement.’
Katjaerua explained to Mutorwa that the African Development Bank does not finance expenditures under a contract for goods and works if the bank concludes that such a contract has not been awarded in accordance with the agreed provisions in the Financing Agreement.
“In such a case, the bank will declare ‘mis-procurement’, and it is the bank’s policy to cancel that portion of the financing allocated to the goods and works that have been mis-procured.”
The Roads Authority board chairperson made it clear to Mutorwa that according to the agreement with the African Development Bank, only the authority must adjudicate the tender and make recommendations to AfDB through the line ministry for a no-objection.
“It is our understanding that, although we respect the role of the ministry as the executing agency, the executive director does not have powers in terms of the existing RA procurement procedures, the loan agreement and its annexures, the AfDB rules, or any other law to demand that our board recommendations must be made to him for his review and final decision, before these are transmitted to the AfDB.”
Katjaerua demanded that the board be exonerated from accountability concerning any consequences which may emanate from a decision which it did not take.
The Roads Authority board seems to have the support of the Minister of Finance Calle Schlettwein who wrote to Mutorwa on 6 August saying it is important to accept and remain with the recommendations offered by the elected Evaluation Committee.
Unnamed complainants to the ministries of finance and works wrote that the roads management team made false claims that Zhong Mei Engineering Group has built the highest quality roads in Namibia despite “their eight months of struggling and their use of unlicensed and illegally smuggled equipment from Zambia on DR3609, Oshakati-Ongenga”.
“Again, instead of looking at China Harbour, the RA management went on to claim that they could not consider them due to their inflated pricing on the oil storage facilities and the port project. They further went to skip Puentes and Qingjian, who all scored higher than Zhong Mei Engineering Group.
The complainants alleged that despite poor performances on the Swakopmund/Henties road and several sub-contractors having written to the Roads Authority about Zhong Mei wrongfully terminating their contracts, a recommendation stands in their favour.
“On the SWAKOP/Henties project, RA engaged an independent consultant who found that Zhong Mei was guilty of mistreating sub-contractors on their site and terminating their contracts without paying them.”