Corruption / Huawei’s shenanigans in Africa

5 mins read

African countries are easy targets for the Chinese giant. Taking advantage of normalised widespread corruption, little oversight and dysfunctional governments, Huawei does as it pleases in Africa as we will see through this article.

In 2016, ‘Algerie Telecom’, the public communications company catering to the Algerian market awarded a contract for the installation of an optic fibre network at a value of over 300 million dollars without any call for tenders, in violation of the laws regulating the award of public contracts. This contract followed the award of another contract with a value of 50 million dollars, which was not even finished at the time of the award of the second contract. Additionally, the Algerian tenders commission supposedly in charge of reviewing the contact did not even have a look at the contents of said contract.

Furthermore, the 300 million dollars contract does not provide Algerian companies with any technological transfer as falsely claimed by Minister of Post, Information Technology & Communications, Houda-Imane Feraoun, when questioned about the shadiness of the award. Houda-Imane Feraoun is a self-proclaimed astrophysicist and is rumoured to have reached her position of power after dating former president’s brother Nacer Bouteflika. She is still part of the Algerian government.

According to investigative journalist Abdou Semmar, currently in exile in France, the project’s costs were inflated by… 100 millions dollars, which corresponds to 30% of the value of the project. To come up with this figure, the investigative journalist resorted to experts in the field of telecommunications who estimated that the costs were largely inflated.

In a more recent investigation, it has been alleged that the Algerian minister of telecommunications Houda-Imane Feraoun unlawfully discarded the offer of a Canadian tech company which won the bid for the construction of a Hub in Lakhdaria, after exerting pressure on the CEO of ATS (Algerie Telecom Satellite, another public body), summoning him and the members of the commission of evaluation of public contracts to award it to the Chinese giant.

Lakhdaria’s data center

This isn’t the first time the Algerian minister of telecommunications is involved in allegations of corruption.

While the realization of the largest data center in Europe, a futuristic infrastructure located in Portugal, has not exceeded 90 million euros, the Algerian authorities sought to grant more than 162 million dollars to a Chinese company to build a data center in Lakhdaria, in the wilaya of Bouira. The budget allocation decided at the beginning of 2018 for this project has been largely inflated, raising serious suspicions of bribery.

At the time, the Algerian government and its prime minister were alerted about the questionable costs of this project considered strategic for the digital development of the country.

The Hotel Investment Company (SIH), a public company answering directly to the Prime Minister and led since its inception in the 1990s by Hamid Melzi, currently imprisoned in El-Harrach prison, prepared a damning report on the anomalies found in this contract, given to Hong Kong-based PCCW Global. In its report, the SIH had warned the government that PCCW Global’s offer was at least 40% higher than world market prices.

It must be noted that one of the most sophisticated data centres in the world, built in the suburbs of Montreal cost barely 127 million dollars.

Another example of the Chinese inflating prices can be seen in the construction of the new mosque of Algiers which cost the Algerian taxpayer 2 billion dollars, 500 million more than Burj Khalifa.

Burj Khalifa.

The Algiers mosque was one of the most controversial infrastructure to ever be built in Algeria, experiencing years of delays, and was finally completed recently by the Chinese construction company CSCEC. In 2009, the company was blacklisted for six years by the World Bank for collusion in the bidding process for the Philippines National Roads Improvement and Management Project. Additionally, a reputable German design bureau, which was discarded in strange circumstances during the early stages of the mosque project, questioned the design choices of the Algerian authorities and the CSCEC.

The Algiers mosque construction was tainted with allegations of corruption with a cost 500 million higher than Burj Khalifa’s, Burj Khalifa is considered an engineering feat whilst the Algiers mosque is a simple structure, relatively speaking.