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3 May 2022

Irvin Pekmez, Balkan Investigative Reporting Network (Bosnia and Herzegovina)

Bosnia and Herzegovina: Secrecy surrounding Chinese tram contract raises transparency and safety concerns

"Secrecy Surrounding Chinese Tram Contract in Sarajevo Raises Alarm" 3 May 2022

Authorities in Bosnia’s Sarajevo canton are refusing to release the contract they signed with a Chinese consortium for the reconstruction of the capital’s tram lines, making public oversight impossible.

Secrecy surrounding the terms of a 20 million-euro contract to relay tram lines in the Bosnian capital, Sarajevo, is raising concern over the transparency of the project, awarded to a consortium of Chinese firms, one of which is associated with a record of controversy and workplace accidents.

In June last year, authorities in Bosnia’s Sarajevo Canton awarded the contract to a consortium of China Shandong International Economic & Technical Cooperation Group and China Railway No.10 Engineering Group Co, CREC 10.

CREC 10 is part of the China Railway Engineering Corporation, CREC, working under the umbrella of another CREC subsidiary called China Overseas Engineering Group, COVEC. Both CREC 10 and COVEC were involved in the construction of a bridge in Kenya, part of which collapsed in June 2017, injuring 27 construction workers.

The Sarajevo canton transport ministry has repeatedly refused to provide BIRN access to the contract or answer questions concerning CREC 10’s record. [...]

The Cantonal transport ministry did not respond to a request to release the decision declaring the contract confidential, violating a 15-day deadline under the Law on Free Access to Information.

Experts say that without full transparency it is impossible to properly monitor the legality of the work carried out. [...]

BIRN has identified at least three serious accidents on construction sites involving CREC 10. In mid-2017, part of a bridge being built by COVEC in the Kenyan town of Sigiri collapsed, injuring 27. [...]

Other members of the CREC family have run foul of the World Bank. In 2019, the World Bank banned CREC 1 from participating in its tenders for two years over alleged wrongdoing during tender procedures for at least four contracts, two of which CREC 1 won in 2015. [...]

In a written response to BIRN, the Sarajevo cantonal transport ministry said that it was familiar with the record of the companies that submitted bids for the tram project, “to the extent that the bidders were requested to present historical data in the tender documentation.”

According to tender documentation and conditions seen by BIRN, bidders were required to certify that they did not have a “continuous history of judicial disputes” or lost lawsuits between 2015 and 2019.

The ministry, however, refused to make available the content of the winning bid or the subsequent contract that was signed, citing procedural requirements set down by the European Bank for Reconstruction and Development, EBRD, which provided a loan to pay for the project. The contract, the ministry said, is confidential. The EBRD declined to comment on the record for this story so BIRN was unable to independently confirm that the ministry’s reasoning is accurate. [...]

BIRN has previously sought to contact Shandong’s head office in Banja Luka, under the name SDHS-CSI BH.

A person who answered on the mobile number listed in the official registry said they previously “kept the books” for the company but were not authorised to speak to media. The person provided a landline, but no one answered on that number. BIRN was unable to find any other contact details online.

In 2018, SDHS-CS BH signed a contract to build a highway between Banja Luka and Prijedor. Work began in November 2021, when Republika Srpska authorities said details of the deal would not be made public unless the company involved allowed it.

Asked about public complaints concerning the transparency of the Banja Luka-Prijedor highway deal involving Shandong, the Sarajevo cantonal transport ministry told BIRN it was not familiar with the allegations.

Cantonal Transport Minister Adnan Steta and the Prime Minister, Edin Forto, did not respond to requests to be interviewed for this story. [...]

Responding to criticism concerning the transparency of the project, Steta told a press conference on April 14 that he was among a new generation of politicians “who have taken on the responsibility of informing the public about everything that the previous [generation] did not for the past 30 years.” [...]