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US$109m tender scam rocks Zinwa

by Staff reporter
06 Aug 2021 at 07:49hrs | Views
THE Zimbabwe National Water Authority (Zinwa) is embroiled in a tender scandal after it controversially awarded a US$109 million tender to China Nanchang for the construction of Kunzvi Dam, despite the existence of a lower bid.

Another Chinese company, SinoHydro's bid, which was rejected, amounted to US$66 million, giving a staggering US$43 million variation which has raised eyebrows.

A total of 11 companies were vying for the lucrative tender to construct the long-awaited water reservoir touted as the lasting solution to Harare's water woes.

The contractor will work on a build, operate and transfer basis.

It emerged this week that China Nanchang's winning bid was one of the highest. China Nanchang's bid is also higher than that of JR Godart (US$83 million), China Jiangxi (US$78 million) and R Davis (US$99 million).

SinoHydro had the biggest profile of the 11 entities, having previously successfully undertaken the expansion of the Kariba South Power Plant and is also on course to finish the expansion of the Hwange Thermal Power Plant.

It also won the tender for the establishment of the Batoka Gorge Hydro Power Plant to be shared between Zimbabwe and Zambia.

The other firms, which submitted bids higher than China Nanchang include Bitcoin and Kuch Construction (US$142 million) and Draw Card (US$109 million).

Documents seen by the Zimbabwe Independent this week show that SinoHydro, in a joint venture partnership with locallyowned Marmfold, submitted a bid worth US$65 523 463,61, while China Nanchang submitted a tender proposal valued at US$108 885 000.

According to the documents, on the affordability score, SinoHydro's bid was ranked number 1 while China Nachang's costly bid was ranked number 5.

The highest bid was submitted by Exodus and Company, valued at US$197 130 196,38, followed by a proposal by Nyagui Construction, which wanted to construct the dam at a cost of us$149 447 353,88.

Locally-owned firm, Masimba was ranked number 8 with its us$140 191 249,41 bid, while Multi Force Construction ended the race at number 7 with a us$121 286 896,77 proposal.

upon losing the bid, which official sources allege was irregularly awarded to China Nanchang, SinoHydro wrote to Lands, Agriculture, Water, Fisheries and Rural Resettlement minister Anxious Masuka complaining about how the tendering process was handled.

In the letter of complaint, SinoHydro accused Zinwa of flouting tender procedures.

"Zinwa has officially noticed that the Kunzvi Dam project was awarded to China Nanchang at the price of us$108 247 807,50, which is around us$43 million higher than the lowest bidder price. so as the lowest bidder, SinoHydro herewith appeals to you against the unfair decision. SinoHydro submitted its bid at the most competitive technical proposal at the lowest price of us$65 523 463,61 which evidently must have won the bid," SinoHydro wrote.

official sources told the Independent this week that SinoHydro has since escalated its grievances to the office of the President and Cabinet (oPC) as well as Vice-President Constantino Chiwenga, seeking annulment of the tendering process.

At the time of going to print, as understood by the Independent, the oPC was probing the allegations.

Prior to SinoHydro registering its complaint, Zinwa's chief executive officer taurai Maurikira had on tuesday, written to the company disclosing the results of the tender process which was awarded to China Nanchang.

"The Zimbabwe National Water Authority (Zinwa), has, in terms of section 55(1)(a), of the Public Procurement and Disposal of Assets Act, awarded the tender for the construction of Kunzvi Dam to China Nanchang P/L at the cost of us$108 247 807,50," Maurikira wrote.

"Accordingly, be advised that your bid relating to the above was unsuccessful. You also stand guided through section 67 of the Public Procurement and Disposal Act (PPDA). We thank you for showing interest in our tender, and it is my hope you will receive a positive outcome," the letter reads.

SinoHydro also described the tender award as not just unfair, but illegal.

"We haven't been clearly informed of the reason why our bid was rejected by Zinwa. In addition, hardly can we understand the reason why government decided to spend us$43 million more in the infrastructure project which is to benefit people's livelihoods," the letter further reads. "Besides, the tendering procedure is also illegal and not fair. At our own expense, we have conducted the supplemental investigation, core collection and various experiments relating to Kunzvi Dam which plays a vital role in water supply to the capital city, Harare."

Approached for comment, Maurikira said: "The tender process is only over 14 days after the announcement of the winner. The 14-day window is given for any other submissions/complaints from losing bidders. After the 14-day window is over, then the process is deemed to be over should there be no issues raised. Where issues are raised, these are then dealt with. That's the process for all tenders according to PRAZ (Procurement Regulatory Authority of Zimbabwe).

"We are still within the 14-day period to give room for possible challenges to the award. I am of the opinion that answering these questions may compromise due process. I am comfortable to answer these questions after the 14-day window which expires on the 24th of August."

sources close to the tender told the Independent that SinoHydro was "disappointed by the decision made by government" and was in the process of preparing an appeal at the Administrative Court.

"It is clear that considering a price variation of us$43 million separating the bid of Nanchang and SinoHydro, SinoHydro will seek legal recourse. A poor nation like Zimbabwe cannot afford to pay over us$43 million much more than the cheapest bid at a time government is struggling to source for vaccines for its citizens. It's clear, some people were corrupted," a source said.

Contacted for comment yesterday, Masuka said he was not aware of the developments.

"I have not been made aware of those issues," he said, promising to check.

Financial documents show that SinoHydro from 2015 injected us$3 million in preparatory work ahead of submission of their bid to the government to take up the mega Kunzvi Dam project.

since Independence in 1980, construction and completion of the dam has been touted as a solution to Harare's perennial water shortages and a key enabler to the country's evolving agriculture sector.

But over the same time, the promising project has failed to take off due to protracted negotiations between government and potential suitors.

Source - the independent
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