A disputed road project funded by the Asian Development Bank is proceeding despite a lawsuit and an ADB investigation, government officials and lawyers said.
The 65-km stretch of National Route 7, which begins 18 km south of Kratie town and continues to Snuol town, is being funded by an $11-million ADB loan.
Last month, the subcontractor carrying out the construction, Korea-based East Toyo Construction Co Ltd, sued the main contractor, the China Jilin International Economic and Technical Corporation, in Kratie provincial court.
East Toyo claims that China Jilin altered the original specifications for the road, skimping on its embankments so the project would cost less, thus allowing China Jilin to increase its profit.
The altered specifications would have led to the construction of a road that would have lasted for only six months, East Toyo claims.
Kratie Prosecutor Penh Vibol said the court’s investigation is continuing.
China Jilin attorney Ka Savuth said the project is continuing with work being done by local subcontractors. If China Jilin stops work on the road, the government and the ADB will fine the company $5,000 a day, Ka Savuth said.
He said the road is now being constructed according to the original specifications. The Ministry of Public Works and the ADB have tightened their scrutiny of the project since the lawsuit, Ka Savuth said, adding that representatives from the ministry and the bank now visit the site every day.
According to a letter sent by the ADB to East Toyo lawyer David Chanaiwa, the anticorruption unit of the ADB’s Office of the General Auditor is also looking into “allegations of fraud and corruption” against China Jilin. Chanaiwa showed the letter to The Cambodia Daily.
The letter, sent from the ADB main office in Manila, asks Chanaiwa to “provide us with further details” of his investigation.
Officials familiar with the project in the ADB’s Phnom Penh office were out of town. The ADB’s Manila office did not respond to an e-mail request for comment on Wednesday.
Chanaiwa expressed frustration that the case seems to have stalled in the Ministry of Justice. He said he plans to fly to Manila to present documents and other evidence to the ADB in person.
Ouk Chan, undersecretary of state for the Ministry of Public Works, said the ministry didn’t want to get involved in what it sees as an internal matter between China Jilin and East Toyo.
“We don’t care about this dispute. We only care that the road gets finished and that it is good quality,” he said, adding that senior ministry officials returned this week from a visit to the site and were monitoring the work.
The road construction project is divided into three phases. The first phase is now about 25 percent finished, Ouk Chan said.
Meanwhile, East Toyo is demanding $400,000 for the work it completed before the lawsuit, and $1.27 million in labor, transport and equipment costs.
China Jilin lawyer Ka Savuth said the company could not be accused of wrongdoing so long as the road is completed on time to the original specifications, no matter what happens in between.
But Penh Vibol, the prosecutor, said a breach of contract could be found if it is discovered that China Jilin agreed to one set of plans with the ADB and another set of drawings for the same road with its subcontractor.