Market Commentary and Intraday News
World Bank cancels $1.2 billion Bangladesh loan
326 days ago
By JULHAS ALAM
(AP:DHAKA, Bangladesh) The World Bank has canceled a $1.2 billion loan for construction of a bridge in Bangladesh, saying it has credible evidence of corruption involving a Canadian engineering company.
The global lending agency said it did not receive a satisfactory response from the Bangladesh government after it raised the issue of corruption last year.
It said in a statement Friday that it has evidence pointing to "a high-level corruption conspiracy" among Bangladesh government officials, executives of Canadian engineering and construction giant SNC-Lavalin, and private individuals in connection with the planned 6.5-kilometer (4-mile) Padma Multipurpose Bridge Project.
Bangladesh Communications Minister Obaidul Quader called the World Bank's decision regrettable because the government's Anti-Corruption Commission was still investigating the allegations.
"Such a decision is unfortunate before the investigation is complete," he told reporters Saturday.
The bank said it earlier sent a team to Dhaka to explain its position and receive the government's response.
"The response has been unsatisfactory," it said.
The bank "cannot, should not, and will not turn a blind eye to evidence of corruption," it said.
Montreal-based SNC-Lavalin, one of the world's largest engineering and construction companies, has acknowledged making improper payments to agents to win contracts on two projects. An internal probe resulted in the resignation of its CEO and two other senior executives. The company's headquarters was searched by Canadian national police in April.
Bangladesh has been rated one of the world's most corrupt nations by Berlin-based Transparency International.
The World Bank loan, signed In April last year, was part of a funding package for construction of the $2.9 billion bridge, slated to be the country's longest.
Funding also was expected from the Asian Development Bank, the Japan International Cooperation Agency and the Islamic Development Bank.
The World Bank first brought the corruption allegations in October last year.
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