You’re in for a wild ride when your favorite news show begins like this:
“The Dams, the Scums, the Hyenas and the Thieves and that’s just the beginning.”
That was the voice of Francis Gachuri, anchor person for a lively news show on Citizen TV in Kenya. The topic was deadly serious – billions of shillings designated for the construction of two hydroelectric dams had gone missing and the company that took the money – CMC di Ravenna – just declared bankruptcy.
It’s been called Kenya’s biggest scandal yet and in a worst case scenario, Kenya could be on the hook for the billions of dollars it borrowed to get the project off the ground.
At least US$146 million of public money is at risk of being lost as the Italian contractor at the center of bribery claims involving Kenyan Cabinet Secretaries appears to have left the sites of three mega projects.
CMC Di Ravenna, which has been declared bankrupt at home in Italy, has abandoned the hydro-power and drinking water projects in Nakuru and Elgeyo Marakwet counties despite receiving a down payment from which it is alleged kickbacks were paid.
Before declaring itself insolvent, CMC di Ravenna had agreed to finance the Arror and Kimwarer dams project located in Elgeyo Marakwet county, set up a power plant, transmission lines and other related infrastructure and recover its money by selling power to the government for an unspecified number of years before handing back the dams to the government.
But the local Kerio Valley Development Authority (KVDA) and the National Treasury went ahead and borrowed money in the name of taxpayers to launch the ghost projects.
CMC di Ravenna received US$77 million, while US$107 million went to insuring the project’s loan. Another US$49 million was given to Italy’s government as a commitment fee.
In a report just presented to the National Assembly, Auditor General Edward Ouko said he found no evidence of who was paid the money, when the money was paid and by who, and who granted the authority for the money to be paid. He added that no environmental impact assessment report was given for audit.
Further, it appeared that no compensation had been made to the affected community members.
The two projects would have provided water for irrigation for over 50,000 people living in the vast region, and 80 megawatts of electricity to the national grid.
Source: Global Information Network