On October 29, state-owned China National Electric Engineering Company (CNEEC) and the company’s subsidiary, China Electric Design and Research Institute Company Limited (CEDRI), were subjected to an 18-month sanction by the World Bank Group for their fraudulent activities in the implementation of a $210 million electricity transmission project in Zambia’s capital city of Lusaka that was funded by the World Bank.
The Lusaka Transmission and Distribution Rehabilitation Project is intended to reinforce the city’s power transmission infrastructure, increase the network’s design capacity, and increase the reliability of power transmission for consumers.
CEDRI has reportedly confessed to failing to disclose a conflict of interest in the contract bidding process and submitting false documents with CNEEC’s name to meet contract requirements.
As per the sanctions, CEDRI is to be debarred from all World Bank-funded projects for 18-months. The company’s parent entity is subject to a conditional non-debarment in the same period, whereby it has permission to participate in WB projects as long as the Chinese firm remains compliant with the stipulated settlement agreement. Under these sanctions, CEDRI could also be subject to cross-debarment by other multilateral development banks.
CEDRI’s parent entity, CNEEC, maintains several active commercial interests around the world. The company has been/is involved in several energy infrastructure projects in Asia, Africa, South America, and Europe.