FOCAC needs anti-corruption convention against corrupt Chinese businesses
China is increasingly making efforts to establish better and stronger relationship with Africa. The forum on China-Africa Cooperation (FOCAC) is a platform that Chinese authorities have created to build stronger win-win relationship with Africa.
FOCAC was established by the Government of China in the year 2000 to help nurture, consolidate and broaden relations between China and Africa. FOCAC provides a diplomatic mechanism to promote dialogue between China and Africa, and also facilitate the development of a common political and economic agenda to advance constructive South-South cooperation for the mutual benefit of both sides.
This year’s FOCAC ended with the adoption of the FOCAC Beijing Action Plan (2019-2021) and a resolve toward an even stronger China-Africa community with a shared future.
African leaders spoke highly of the summit and agreed that it was a historic meeting strengthening Africa-China solidarity and cooperation.
Increasingly, Chinese companies are trooping into Africa to do business. It is estimated that over 3000 Chinese businesses are currently operating and investing in Africa resulting in over $100 billion.
This year’s FOCAC ended with the Chinese President, Xi Jinping making a pledge of $60 billion to support Africa.
Ghana prior to this year’s FOCAC, signed eight Cooperation Agreements and Memoranda of Understanding in different sectors of the countries’ economies to help deepen bilateral relations between the two countries.
The agreements are; One belt one road Memorandum of Understanding, Memorandum on Regional Aviation Cooperation, Agreement for Cooperation in the peaceful use of nuclear energy, Cooperation to carry out Maternal and Child Health Project, Framework Agreement on Financing Insurance Cooperation ($2 billion Sino-Hydro deal), Economic Cooperation on Phase 2 project of the University of Health and Allied Sciences in Ho, Cooperation on the expansion of the Cape Coast Stadium, Cooperation on the supply of vehicles to the Ghana Police Service.
This notwithstanding, FOCAC should not only be used to promote merely economic cooperation. African leaders must not just be excited about the investment volume promised and the number of Chinese enterprises doing business on the continent. They must demand fairness, transparency and ethical conduct in the operations and businesses the Chinese people are involved in. Without this, Africa may be losing more to corruption in dealing with Chinese companies than the Chinese are actually investing in Africa.
Many figures have been quoted at different times by different persons as to how much Africa loses to corruption annually but averagely, it is estimated to be about $148 billion annually.
According to Transparency International, the global anti-corruption organisation, the Chinese government has made significant efforts to curb domestic bribery and corruption in recent years, and China has developed the anti-foreign bribery legal framework.
However, Transparency International in its 2018 Exporting Corruption report says China has faced increasing criticism for failure to enforce its anti-foreign bribery laws.
Here are some of the alleged bribery and corruption cases that some Chinese firms were said to have been associated with in the 2018 Exporting corruption report.
China Harbour Engineering Company, a Chinese company currently working on the Tema Port Expansion Project in Ghana, is listed to have been recently blacklisted in Bangladesh for allegedly offering to bribe the top bureaucrat in Bangladesh’s Roads and Transport ministry to obtain construction work.
China International Water and Electric (CWE), a contractor for a hydroelectric plant in Ecuador, is under investigation by the Ecuador Attorney General for alleged bribery and the World Bank also sanctioned this company with debarment in 2014 for misconduct in Africa and Southeast Asia.
In 2017, a Chinese construction company was allegedly involved in embezzlement of 1.1billion birr ($47.2million) in Ethiopia and its senior officials detained along with over 30 senior Ethiopian government officials, businesspeople and brokers.
In Kenya, Senior Managers of China Roads and Bridge Construction Company were accused of allegedly bribing officials of the highways authority in 2015.
The Council of Ethics for the Norwegian Government Pension Fund Global, in 2015 recommended the exclusion of the Chinese company ZTE from the Government Pension Fund Global due to corruption allegations involving the company in several countries. The company also had a Zambian $210 million closed circuit television (CCTV) contract canceled due to bribery and corruption allegations in 2014.
China Communications Construction Company and China Harbour Engineering Company were alleged to have bribed the President of Sri Lanka and in 2015, Zambia’s former Minister of Mines was convicted of corruption for his role in the award of prospecting licences to Chinese mining company Zhonghui International Mining Group.
The United States of America reports on more than four foreign bribery investigations or cases involving Chinese companies and businesspeople in 2016 and 2017 – almost all the cases are happening in Africa.
With regards to money laundering, China’s largest state-run bank, Agricultural Bank of China (ABC) was fined $215 million by the US government in November 2016 for allegedly masking suspicious transactions at its New York branch and omitting information regarding transactions with sanctioned countries.
Transparency International says however, that there is no evidence of cases or investigations brought by the Chinese government against Chinese nationals or companies for bribery of foreign officials.
China should ensure that the similarities of bribery of foreign and national public officials are taken into account in order to maintain necessary consistency in the criminalization of these two types of acts, the 2018 Exporting Corruption report says.
With this revelation about China’s inertia to independently investigate and take punitive measures against its nationals and businesses that are cited in corruption and bribery cases abroad, African leaders should and must use the Forum on China-Africa Cooperation (FOCAC) to enter a Convention for China to enact and actively enforce laws against its people and businesses companies bribing and other spending irregularities in Africa.
With Africa’s weak systems, the least China could do to support Africa’s developments is to ensure its businesses and nationals conduct ethical, transparent and fair business in Africa.
By Bismark Elorm Addo
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