Bangladesh may make World Bank letters on Padma bridge corruption public

Inam Ahmed The Daily Star July 15, 2012

The World Bank (WB) has said the government may disclose the Bank’s reports containing “evidence of corruption” in the Padma bridge project for the sake of transparency and public interest.

FULL TEXT OF THE INTERVIEW

But the WB cannot itself disclose the reports because it has an obligation to each member country — including Bangladesh — to maintain all referral reports confidential.

Ellen Goldstein, the World Bank’s country director, said this in written response to questions from The Daily Star.

Her observation clearly puts the government in a position to make all the WB reports and letters public.

Earlier, disclosing what the government wrote to the WB, Finance Minister AMA Muhith had said that Bangladesh would not disclose the Bank’s reports and documents as a mark of respect for the global lender’s confidentiality.

Goldstein answered 18 written questions submitted by this paper. This is the first time a World Bank high official has spoken up after the Bank scrapped the loan for the Padma bridge project on June 29.

She said the Bank would have no objection if the finance minister discloses the reports and correspondences of the World Bank that contained “evidence of corruption”.

Queried about the findings of the investigation, she wrote, “The Integrity Vice Presidency looked into corruption allegations under the Padma bridge project and found sufficient credible evidence to warrant national investigation.”

Evidence from one source has been corroborated through multiple sources. If the evidence is as innocuous as claimed, then the government should not hesitate to publicly release it, she continued.

“We presented the same evidence to the Canadian authorities who found it sufficiently credible to launch their own investigation. This has now led to arrests of high-ranking private executives in Canada on charges related to the Padma Bridge. This alone should be sufficient to convince the Bangladeshi authorities of the need to conduct their own full and fair investigation.”

When asked who the individuals were alleged to be involved in the scam, Goldstein said: “I cannot disclose individual names.”

The latest referral report found evidence of a conspiracy to engage in corruption that involved public officials in Bangladesh.

She also refuted allegations that the Bank had favoured a Chinese company in the project.

“The Bridge Authority excluded the China Railway Construction Corporation from the pre-qualification list without providing adequate justification,” she explained. “The World Bank then requested the Bridge Authority to seek clarifications and provide additional justification for exclusion. When this was eventually provided, the World Bank agreed with the decision of the Government to exclude the firm.”

She was asked if the loan cancellation was done in a haste and that it could have waited until the loan effectuation date ended.

She said the World Bank was in discussion with the government for nearly a year, seeking a serious commitment to address evidence of corruption under the project. Unfortunately, the government took no such action for nearly nine months, leading many to call for the early cancellation of the loan.

“The World Bank mounted an urgent mission to Dhaka to find a way forward in late June. After days of discussions with Bangladeshi authorities, the mission members were forced to conclude that commitment was lacking for two of the four measures proposed. On this basis, the World Bank Management Team reluctantly took the decision to cancel the loan,” she added.

As the government had indicated no further scope for discussion of the proposed measures, it was logical to proceed with cancellation of the loan immediately, she further added.

“It was a unanimous decision of the World Bank Management Team, not an individual decision, and it was motivated by a lack of commitment on the part of Government to seriously address corruption,” the Bank’s country director for Bangladesh and Nepal said.

She also said the decision about the Padma bridge loan does not have a direct impact on the World Bank’s broader programme of support for Bangladesh.

“However, the government’s weak response to evidence of corruption in a flagship operation adds to mounting concerns about a deteriorating governance environment in Bangladesh, and this will be reflected in our programme going forward,” she added quickly.

“Going forward, the World Bank will reduce our exposure in areas at high risk of fraud and corruption.”

Asked if the Bank’s loan decision can be reviewed, Goldstein said the World Bank has a few precedents in its history of reinstating a cancelled loan in other countries, so it is technically possible.

Then she added: “I see little scope to revisit the decision in this instance, as it was taken after extensive discussions with Government about the response to evidence of corruption under the Padma Bridge Project.”

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