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$33-M ROAD PROJECT
Contractor protests World Bank ban

Denies collusion with other construction firms

By Jerome Aning, Gil C. Cabacungan Jr.
Philippine Daily Inquirer
First Posted 01:40:00 01/22/2009

Filed Under: Government Contracts, Graft & Corruption, International Economic Institutions, Heavy construction, World bank road mess

MANILA, Philippines?The Filipino contractor blacklisted for life by the World Bank on Wednesday appeared before sympathetic House legislators and denied charges that he colluded with six other Filipino and Chinese companies in rigging the bidding for a $33-million road project to be funded by the multilateral agency.

?The allegations of the World Bank against my firm and my person are not only blatantly and grossly unjust, they are also bordering on the comic and insane. For the record, my firm is officially accredited with a triple A status and is one of the biggest road project [builders] in the country. Its integrity has never been assailed,? said Eduardo C. de Luna, president of the E.C. de Luna Construction Corp.

?Multiple hearsay?

De Luna, who described himself as a ?simple Filipino from Nueva Ecija with no resources to do battle with a giant like the World Bank,? called the permanent ban ?an arbitrary and unjust action ....which has caused premature judgment of guilt on my part.?

He insisted that the World Bank charges of collusion were based on ?multiple hearsay? and accused the World Bank of refusing to hear his side and confront the ?anonymous and unverified informants ...and confidential witnesses.?

The World Bank last week said it had evidence of collusion among four Chinese and three Filipino construction firms in the bidding for the road project. It canceled the tender for the contracts worth $33 million and banned the firms from future tenders.

De Luna and his firm were barred permanently from Word Bank tenders, ?the first permanent banning since 2004,? the bank said.

WB-bashing

De Luna read from a prepared statement during the opening of the public works committee hearing into the controversy, asking the legislators to ?protect Filipino businessmen from the unfairness and injustice which giant financial institutions are not unlikely to commit.?

Many of the congressmen took turns defending the contractors and bashing the World Bank for snubbing the hearing. Leyte Rep. Roger Mercado, the committee chair, said bank officials should attend the committee hearing next week or face sanctions from the House.

They criticized Public Works Secretary Hermogenes Ebdane for immediately slapping a suspension order on the banned companies without studying the basis of the sanctions.

Minority Leader Ronaldo Zamora said the DPWH should have been more careful in suspending the Filipino companies because the news reports on the alleged rigging could be erroneous.

Ebdane, who was at the hearing, said the department based its suspension order on the press release found in the World Bank website. He also revealed that there were no major projects up for bidding during the 15-day suspension.

De Luna?s denial was supported by representatives of the other companies sanctioned by the WB?the Philippine-based Cavite Ideal International Construction and Development Corp. and CM Pancho Construction Inc., both banned for four years; and the Chinese-based China Road and Bridge Corp. (barred for eight years), China State Construction Corp. and China Wu Yi Co. Ltd. (six years each), and China Geo-Engineering Corp. (five years).

China State CEO Conrado Donato accused the World Bank of unduly targeting Filipino and Chinese firms that participated in the bidding while leaving out the Korean and Japanese contractors.

De Luna said that he was targeted because of disgruntled contractors that lost in the bidding.

In slapping De Luna with a lifetime ban, the World Bank took note of his role as alleged ringleader of the scheme.



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