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March 2017

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Why Transport Ministry is GIPIng?

21/11/16 12:22, Bishkek – 24.kg news agency, by Tatyana KUDRYAVTSEVA

2016 became the champion in the number of scandals around the road projects. The Minister of Transport and Roads gets all the bumps. In fact, not him but the Group of Investment Projects Implementation (GIPI), led by Kubanychbek Mamaev, plays a key role there.

GIPI attacks

Almost all major road projects in Kyrgyzstan are implemented at the expense of external grants and loans. The so-called Group of Investment Projects Implementation (GIPI) under the Ministry of Transport is managing the investments. In practice, the structure is virtually all-powerful and is not really accountable to anyone.

GIPI is not a legal entity and is funded in accordance with international treaties. Do you remember the scandal around Balykchy - Korumdu road? And the story with a tender for the reconstruction of Bishkek - Kara-Balta road? In the first case, the Transport Minister and the Prime Minister lost their warm seats. In the second, it was again the head of the Ministry of Transport. And everybody somehow forgot about GIPI. Or preferred not to remember.

Meanwhile, it is exactly GIPI that draws up and implements all the road projects. It should hold tenders and monitor the implementation of projects. It coordinates communications of the borrower- Kyrgyzstan - with donors. Having grabbed powers, GIPI as a result can not handle even with a half of them.

Should we also work?

The last audit of investment projects shows how the structure "works". There are few examples.

In 2014, the World Bank financed road rehabilitation project Osh - Batken - Isfana (section from the 10th to 28th kilometer, Nookat Pass).

During the peak load, the asphalt laying machine was transferred to another project.

The project was not finished in time. For disruption of the schedule, the contractor was accrued a fine of 7, 353.9 million soms. Donor was misled. International consulting engineer could not conduct technical supervision of the remaining work. And GIPI adopted a final certificate in 2014, which for some reason included work in progress. 

Another example of GIPI sluggishness is the construction of an alternative North - South road. Contractor for the first phase of the project was the Chinese company China Road and Bridge Corporation, a consulting engineer - Kyrgyzdortransproekt. The first work started in 2014. The project was drawn up by Kyrgyzdortransproekt, using satellite data and preliminary estimates.

In practice, there have been found significant divergences, which involve additional costs of $ 35 million. 

China Road and Bridge Corporation has presented in December 2015 a new project based on detailed prospecting and topographic surveys. Under the contract, the customer must accept or reject the changes within 28 days. The Ministry of Transport did not make a decision for the first 9 months of 2016.

What will be the results? Disruption of the road construction schedule and sanctions on the part of the contractor for delay in payment for the additional work. Head of GIPI Kubanychbek Mamaev puts the implementation of one of the best initiatives of the President at threat.

Implementation of the fourth phase of the reconstruction of Bishkek - Osh road is stuck thanks to GIPI. The Eurasian Development Bank is financing the construction of 67 kilometers of road from Madanyat village to the city of Jalal-Abad. Under the contract, the project should be completed on December 31. At the same time, GIPI chooses the contractor and the project consultant.

As of August 2016, there was no contractor and consultant. Now we have to negotiate with the EDB to extend the deadline for the project. And if the bank does not agree, then the project will end having not even started.

It is time to ask the leadership of the organization: are you really in the right place? Maybe we should release the seat for someone who is willing to work for the good of the state? 

Car left the track

The public was stirred up by the information that now the ex-minister of transport and road Zamirbek Aydarov used not an official car. He preferred a car owned by China Road and Bridge Corporation, which implements the majority of road projects of the department. However, not only Mr. Aydarov loves someone else's transport.

In 2012, the Ministry of Transport signed a contract with Tera International Group Ltd. on the provision of consulting services on Transport Corridor 1 CAREC (Bishkek - Torugart road) project. Consultant services cost $ 2, 722.8 million. Under the contract, the Ministry of Transport undertakes at its own expense or at the expense of the contractor to provide a consultant with an equipped laboratory at the object, office, housing and transportation.

As a result, the contractor - China Road and Bridge Corporation - has bough to consultant 15 cars for $ 654,000. Transport is accompanied with the fuel and driver services. Totally, the contract cost 1,179.6 million soms.

Therewith, GIPI did not include in the contract with the consultant changes to reduce the fixed costs of transportation. Consultant twice increased transport costs and ultimately presented to the payment $ 33,300. GIPI closed eyes to the inefficient use of credit funds. 

Moreover, the Ministry of Transport has violated the technical specifications of the construction contract with the general contractor. The agency seized the cars until the completion of works, and not after, as it is specified in the documents.

Two Toyota Prado cars were confiscated from the ongoing project on rehabilitation of Bishkek - Naryn - Torugart road. The contractor bought them for consulting engineers. It has brought serious problems. The consultants were not only limited in possibilities to control, but the Ministry of Transport was accused of misuse of funds. 

GIPI can not observe the law even in such cases when everything is quite simple. For example, after completion of the project on rehabilitation of Osh - Batken - Isfana road, the agency got Chevrolet Niva car. GIPI driver used the car for five months and was paid for it. However, all this time, neither the car nor the driver were officially employed by GIPI.

I hire someone that I like

GIPI also does not comply with requirements of the law on public procurement. The projects financed by the Export-Import Bank of China do not include the funds for the maintenance of the staff. But this is not a reason to give up tidbits. In coordination with the Ministry of Finance, GIPI decided to spend a part of unforeseen expenses from the construction contract on the administration of the projects.

In 2015, employees who were hired with gross violations, worked in GIPI. In fact, the people were hired just like that, without mandatory in such cases the competitive selection and approval of the Ministry of Transport. 

 Audit urged GIPI to suspend contracts with these employees. However, the Chamber of Accounts is not authority for Kubanychbek Mamaev. Illegally employed workers continue to work and receive a salary.

The Transport Ministry's lobbying the interests of certain companies goes beyond all possible limits. In July of 2015, the tender commission held a tender to determine the contractor for rehabilitation of Osh - Batken - Isfana road. The tender commission met three times before making a final decision.

Time for the start of construction work has been lost because of the squabbles. The tender took place only in November 2015. As much as $ 23,700 was spent on the operating costs of the same GIPI. Who should be responsible for this disorder?

Where has GIPI been all this time in the person of its head Kubanychbek Mamaev? He was silent and sat in warm offices. Good position! Its' head did not participate in any of the meetings of the tender committee and did not consult the Ministry of Transport on procurement procedures.

It can take a long time to enumerate violations in road projects. They are united by one thing: they all occurred at the time when GIPI was led by Kubanychbek Mamaev.

GIPI was created for a good purpose - to help the state bodies of the Kyrgyz Republic and international donors to find a common language. It has to bring benefits to each. But both lost in the end. Is there a problem with the donors or is it the inability and unwillingness of GIPI head Kubanychbek Mamaev to do good work? 

URL: http://eng.24.kg/economics/182926-news24.html
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«When we ran in the elections, we said that would even get the moon and the sun from the sky ».
MP Kamchybek Joldoshbayev at a meeting of Parliament, February 2, 2017.

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Deputy Ryskeldi Mombekov to the head of State Inspectorate for Veterinary and Phytosanitary Safety Kalysbek Zhumakanov at a meeting of Parliament, February 1, 2017.

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