LTA awards MRT tunnel contract to Chinese firm previously blacklisted by World Bank

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By: Vincent Low/

Last Friday, 8 Dec 2017, the Land Transport Authority (LTA) issued a press release announcing that it has awarded the construction of MRT tunnels between Punggol station and the future Punggol Coast station on North East Line Extension to a Chinese firm, China State Construction Engineering Corporation Limited (CSCEC).

CSCEC won the contract with the lowest bid of $79 million. The contract involves the construction of an 830-metre tunnel between Punggol and the future Punggol Coast station. Works are expected to commence by this month and complete in 2023, LTA said.

However, a quick check online shows that CSCEC has been blacklisted by the World Bank before.

In 2011, the World Bank blacklisted eleven Chinese companies for corruption and fraud, according to a report by SCMP. Most of these Chinese firms were banned for violating World Bank regulations on procurement.

CSCEC was named as one of the eleven. Those banned by World Bank would not be eligible for World Bank-financed contracts and under a 2010 cross-debarment agreement, contractors debarred by the World Bank may also be debarred by other multilateral development banks such as the Asian Development Bank.

Poor-quality sea sand used in construction of skyscrapers in China

Four years ago (2013), Wired as well as Bloomberg reported about a sand scandal brewing in China at the time.

Shenzhen city inspectors discovered that low-quality concrete using raw, unprocessed sea sand had been used in the construction of at least 15 buildings in Shenzhen, including the Ping An Finance Centre, one of China’s tallest.

Both Wired and Bloomberg reported that construction of Ping An Finance Centre and others were halted by Shenzhen’s Housing and Construction Bureau.

Sea sand is far cheaper than river sand. Untreated sea sand is unsuitable for construction because it still contains chlorine and salt, which corrodes steel. River sand from freshwater channels doesn’t have this problem. It can take only a few decades for a building to become dangerously unsafe if untreated sea sand is used in its concrete.

As it turns out, the construction of Ping An Finance Centre was undertaken by CSCEC.

Bloomberg reported that Kong Qingping, CSCEC vice president, said at a press conference in Hong Kong at the time, “I’m not quite familiar with the incident of the Ping An Finance Center, but we put quality and safety as priority in all our projects in 40 cities, including Shenzhen.”

In any case, the construction of Ping An Finance Centre resumed thereafter.

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94 comments

  1. There you go now. A company reputed for bribery. Well done. More breakdowns and stalled trains can be expected when this rail opens. CPIB anything amiss here perhaps. Oh no instructions handed down?

  2. One of many flaws our dumdum gamen is incompetent to run for this Majullah Singapura. It shows how shallow and heartless to its own people. Our cpf is depleting, and not knowing if its still exist. What do you think 70% dumdum supporter, still believe our gamen will deliver for singapura??? Think again, before its to late!

  3. This is the real world. You scratch my back. I scratch your back. SG cannot afford to antagonise China or U.S for survival. Our government has lost its soul of righteousnesss and being sucked into the world of materialism, deceit, and self centred.

  4. Isn’t that a KYC concern? My question is whether they would have been as magnanimous with s local firm previously with such a record? No right so why are they making the exception here? Country really going to the dogs……

  5. Because of the KPI system, some smart alec choose the easy way out by using the lowest bidder as the one and only justification that they have done their job just fine.

  6. Facebook Profile photo
    Soon Eng Lim ( User Karma: 0 ) says:

    So problems start from the time of awarding the project to the lowest tender without checking or …? The reasons for being blacklisted are rsally cause for concern. If the authority is not going to provide an answer on this issue, then the govt should take the blame eventually for having such ‘culture’ when things turn wrong.

  7. for the China name spolit liao la. two things only why LTA give the contract. first they give dam cheap price to LTA. second this company have some investment make by singapore because of no bussiness due to ban and blacklisted cannot sell the share so own bussiness give lor. Singapore Government always like that la blacklist liao so long know some big shot still can get contract like the some construction company been blacklisted but still get contract.

  8. Norman Wee says:

    Look at it this way… Thanks to this report LTA will obviously subject the works to close scrutity. So with a world class contractor undertaking such project at low cost to Singaopre, who can ask for more.

    1. Norman Wee says:

      Sivaramalingam Puthusamy can I give you similar advice to read with understand and then can have a go, especially World Bank and Asian Bank are political and sea sand to build one of tallest building…

    2. norman wee …..in that case by your reasoning , bring in the reputable white collar criminals to run DBS at dirt cheap cheap salary , after all the cpib will pay special attention now !!!! kiang tio hor ng mai gay kiang !!! nahbeh !!

  9. Must have been a package deal with China. Let their state-owned company build the tunnel and let one of our state-owned companies invest in one of China’s own projects. These authoritarian state capitalists like do business like that.

  10. Wyeming Ho says:

    …looks like we have lost our independent decision making position because every business activity is controlled by foreigners. Can’t believe that we do not have any world class construction companies that can take on the project. One wonders at the reports of corruption in such cases…

  11. Calvin Koh says:

    Money should be well spend. And not spend at something that is not necessary or extravagant, and stinge on things that matter. Is there some logic and priority issues with those in white?

    In many first world country, taxes are used as priority to provide good safety network for the weak, vulnerable and old, and for its citizen first, and not vice versa for those in power. For citizens: Many have free education, even free tertiary education, Comprehensive health benefits and good medical / health subsidies, good safety net for those unemployed, the senior and old are well taken care of (especially if they are vulnerable), some even took care of women pregnancy and/or giving birth too. (Some say in some places, public transport for citizens are free too)

    A recent documentary made and broadcast even show that NK provide free education, books and education for its young, free make up and beauty products for its women, free beer (10L every month) to its men, and even free housing too!

    Meanwhile, I don’t understand why some people still can afford to spend to fly private jet, etc? Ownself pay Ownself high high salary, etc?

    Talk about more taxes needed due to increasing social expenses???

  12. Ronnie Lee says:

    Wow … I thought we only deal with reliable companies??? What does this mean when we are dealing with formerly ‘black listed’ company? Are we bending the rules here???

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