Thursday, 26 February 2009

Philippines a model for bidding -- World Bank

By Fel V. Maragay
With Roderick T. dela Cruz, AFP
The Manila Standard

THE World Bank yesterday sidestepped its own findings of bidding irregularities and said the Philippines is being considered as a model for international procurement.

At a technical briefing for the Senate, World Bank country director Bert Hofman said the country was eligible for about $600 million in development loans despite the Bank’s recent report that a bank-funded road expansion project was rigged.

Hofman said financing for road, school, social welfare, food assistance and other projects was already in the pipeline, but it was up to the Arroyo administration to decide which loans to take.

Hofman also told Philippine senators that the World Bank and the Asian Development Bank might adopt some of the Philippines’ procurement rules for international competitive bidding.

“We think highly of the Philippine procurement rules and regulations. We have some debates where Philippine rules differ from World Bank rules. We are considering, together with the ADB, whether some of the Philippine rules may be adopted for international competitive bidding,” he said.

At a press conference after the briefing, Hofman said the senators asked him if the Philippines was in danger of having its loan privileges suspended if the government ignored its report of bid rigging.

That is not under discussion,” Hofman said. “Our policy is one of engagement. We do not... disengage unless in very extreme cases.”

The World Bank sent a referral report to the Office of the Ombudsman in November 2007 and blacklisted three Filipinos and four foreign construction companies after its investigators were convinced that they had colluded in a $33-million road expansion project.

“A referral to the authorities serves to enable them to take the information and documents referred to them and investigate the matter under domestic law as they deem appropriate, and at their discretion,” Hofman told the senators, reading from a prepared opening statement.

“This administrative process is not intended to be, and indeed cannot be, a substitute for a determination by a member-country as to whether the actions of such firms and individuals in a World Bank-financed program or project give rise to breaches of that member-country’s laws,” he added.

Hofman said it was up to local authorities to prosecute companies that the bank had blacklisted for collusion. He also welcomed a Senate inquiry into the case and said it was working closely with the government to improve procurement systems.

Senator Mar Roxas, who presided over the briefing, criticized the Ombudsman for dragging its feet on the case despite the “preponderance of evidence” in the World Bank report.

Ombudsman Merceditas Gutierrez said they started to investigate the alleged irregularities upon receiving the referral report.

But she said the Ombudsman’s probe was stymied by the Bank’s failure to furnish documentary and testimonial evidence, especially the names and addresses of complainants and witnesses.

Gutierrez said that it was only in the middle of this month that the Ombudsman was furnished supporting documents, including transcripts of interviews with the complainants and witnesses.

In reply to a question from the senators, Gutierrez said her office would release its preliminary report on the alleged rigging of bids in a World Bank-funded road project by the first week of March.

Finance Secretary Margarito Teves, who was present at the technical briefing, said the Philippines was now negotiating for up to $l-billion in financing from the Bank for the next three years, including a loan for a rural power project.

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