World Bank bars giant const'n firm from road projects
Construction giant E.C. De Luna Construction Corporation, the company behind major multi-million road projects in the provinces of Antique, Iloilo, Negros Occidental and elsewhere in the country has been blacklisted by the World Bank (WB).
As such, the order is out permanently barring the company and its owner, Eduardo De Luna from participating or getting any WB-assisted projects. The sanction, the WB said in a news release obtained by The News Today (TNT), is the “strongest possible...”
“The World Bank today (Thursday) announced the debarment of seven firms and one individual for engaging in collusive practices under a major Bank-financed roads project in the Philippines. Two of the debarments are permanent, the strongest possible sanction, “ the news release began.
“The debarments, which prevent the parties from bidding on future World Bank-financed contracts, either indefinitely or for the period of the sanctions listed below, result from an in-depth inquiry conducted by the World Bank’s Integrity Vice Presidency (INT). INT is responsible for investigating allegations of fraud and corruption in Bank-financed operations.”
WB probe results have reportedly established evidence of what it termed was a “major cartel” out to corner contracts under phase one of the Philippines National Roads Improvement and Management Program, known as NRIMP 1.
“INT closely analyzed the procurement process the firms participated in and conducted numerous interviews before closing the investigations and initiating sanctions proceedings against the entities. As a result of swift action when suspicions of collusion in the bidding process were raised by the project team, the World Bank stopped an estimated $33 million from being awarded. No World Bank funds from the NRIMP 1 project were disbursed to the now-sanctioned firms,” the news release continued.
“This is one of our most important and far-reaching cases, and it highlights the effectiveness of the World Bank’s investigative and sanctions process. As the World Bank Group continues to ramp up its anti-corruption work, INT will remain vigilant in investigating allegations and holding wrongdoers accountable,” WB Integrity Vice President Leonard McCarthy in a statement said.
“The firms and lengths of debarments follow:
-- E. C. de Luna Construction Corp. and Eduardo C. de Luna, owner and sole proprietor of the firm, were both debarred indefinitely – the first permanent debarments since 2004.
-- China Road and Bridge Corp. was debarred for eight years. The debarment can be reduced or terminated after five years if the firm puts in place a compliance program satisfactory to the World Bank.
-- China State Construction Corp. and China Wu Yi Co. Ltd. were each debarred for six years. In the case of each firm, the debarment can be reduced or terminated after four years if that firm puts in place a compliance program satisfactory to the World Bank.
-- China Geo-Engineering Corp. was debarred for five years. The debarment can be reduced or terminated after three years if the firm puts in place a compliance program satisfactory to the World Bank.
-- Cavite Ideal International Construction and Development Corp. and CM Pancho Construction, Inc. were each debarred for four years. In the case of each firm, the debarment can be reduced or terminated after two years if that firm puts in place a compliance program satisfactory to the World Bank,” the news release continued.
All blacklisted construction firms will be posted in the WB site and will also be ineligible to participate in World Bank Group contracts during the affected period of sanction.
James Adams, World Bank Vice President for East Asia for his part said, “Misuse of public money is a problem for everyone. It deprives the poorest people of the development funds that are so vitally needed and it undermines public confidence in public and private institutions. This case shows our processes working as they should: we detected the possibility of collusion early, we took action to investigate, we worked with the Government of the Philippines to strengthen anti-corruption controls in the next phase of the project and after an extensive and fair process, we have sanctioned the parties involved.”
Sadly, the WB project was primarily designed to aid the Philippine Government in upgrading road networks here.
Several of the local E.C. De Luna Construction works here include the San Jose – Patnongon road network in the Province of Antique, the Asluman Road network to the Province of Iloilo and arterial road links in Iloilo east Coast road towards Estancia, Iloilo.
E.C. De Luna Construction in its official web page “boasts of 16 years of experience in the construction of roads, highways, and bridges. It has undertaken several foreign-assisted construction projects. About 66 percent of the firm’s projects are funded by the ADB, JBIC, Japan Export-Import Bank (JEXIM), and the International Bank for Reconstruction and Development (IBRD). The company has also been awarded several contracts by the national government for various infrastructure projects.”
It was established in 1989 and now has the highest category – AAA - by the Philippine Contractor’s Accreditation Board.
This, the company stated, is “proof of the firm’s topnotch service in construction and civil engineering.”
Main office is in San Juan, Metro Manila yet E.C De Luna Construction dealings is practically everywhere in the Philippines.
It has also been a favorite target for extortion by communist terrorists with a multi-million batching plant in Guimbal, Iloilo burned in 2006 by the group.