Peter Schorsch
In June 2016, Florida Politics wrote an article on the unfortunate corruption that seems to plague Africa’s energy sector and does an extreme disservice to U.S. taxpayers, American-based companies and perhaps most importantly, the region’s neediest inhabitants.
All too often, the world’s poorest — those who most need true progress and development — are the primary victims of graft, mismanagement and greed. While politicians and their friends push bloated contracts for critical services, those whom they are supposed to serve are left to foot the unnecessarily expensive bills.
It is particularly frustrating when such corruption is financed by U.S. taxpayers and hurts honest, responsible corporations based in Florida.
For example, and as we reported in June 2016, the Zimbabwe Electricity Distribution Company, in a shady and unclear deal, awarded a wasteful contract for the generation of 200MW of power to a company with ties to former President Robert Mugabe.
While APR Energy, a proven power-generation provider based in Jacksonville, originally won the tender, Zimbabwe’s officials opted to work with Sakunda Energy, despite the fact that the far less-established company did not even participate in the initial procurement process. As a result, the people of Zimbabwe were left to pay inflated electricity bills to power their businesses and light their homes.
More recently, in Benin, where APR won a bid to supply 50MW of much-needed power using fuel-flexible technology, the country’s president fired a government official for the improper and unapproved termination of the award to APR.
According to our reporting, the Beninese Electric Power Company (SBEE), which has close ties to Aggreko, a UK-based energy company with a checkered background, pushed for this sudden termination, presumably to help win its allies more business. APR, the project’s lowest bidder, had been meeting all of its obligations to help develop Benin’s power sector and boost its energy independence.
While Benin’s President Patrice Talon did well to fire the official responsible, the cancellation of the award to APR is highly suspicious and seems quite corrupt. In addition to other aid, Benin stands to receive $375 million from the U.S. taxpayer-funded Millennium Challenge Corporation (MCC) for the development of its energy sector. However, such assistance should be contingent upon a demonstrated commitment to integrity, honesty and fairness.
U.S. dollars should not help fund graft while also hurting a Florida-based company that supplies equipment manufactured in the United States.
Unfortunately, these same abuses now seem to be sprouting in the energy sector of Malawi, a small, landlocked country in the southeastern reaches of the continent.
In 2016, the Electricity Supply Corporation of Malawi (ESCOM) solicited bids for the provision of 78MW of power at three sites across the country. Yet again, Florida-based APR submitted the lowest overall bid for two of the three sites in question.
Nevertheless, “irregularities” in the tendering process resulted in the improper award of all three sites to Aggreko, although the company did not offer the lowest cost. As a result, Malawi’s Office of the Director of Public Procurement (ODPP) recommended the tender’s cancellation.
Despite the ODPP’s recommendation to the contrary, ESCOM, through a shady and non-competitive “no-bid” process, ultimately awarded the entire project to Aggreko. Malawi’s officials ignored concerns regarding the legality of such a move, and in doing so, approved a bloated contract that does not serve the country’s needs.
Like Benin, Malawi receives a sizable amount of U.S. aid for its energy development, namely through its $350.7 million single-sector compact with the MCC. Such flagrant corruption is a misuse of U.S. funds and jeopardizes future investment in the country.
As Virginia Palmer, the U.S. Ambassador to Malawi, stated in a December 2017 letter to ESCOM, “continued U.S. assistance is contingent on clear, fair, and open application of relevant laws, regulations and procedures.”
Ambassador Palmer is spot-on.
U.S. aid should flow to countries that demonstrate a commitment to transparency, integrity, honesty and the rule of law. Our tax dollars should not help finance blatant greed, theft and corruption.
Malawi has an opportunity to prove to the world its commitment to openness and legality, and in turn, do right by its people. Otherwise, the country, along with Benin and others that engage in shady dealings that disadvantage American companies, should not benefit from hundreds of millions of U.S. tax dollars.
It seems likely that President Donald Trump, with his “America First” agenda, would agree.
