World Bank Blows Whistle On Graft Scandal In Indonesia

Indonesia being regularly rated as one of the most corrupt nations in the world has been hit again when World Bank exposed corrupt practices linked to three loans for infrastructure projects in Indonesia, cancelling them and demanding millions of dollars in refunds.
The three loans were for a regional transport project in eastern Indonesia in 2002, and another for a separate roads infrastructure project in 2003 and 2004
World Bank in a letter to Finance Minister Sri Mulyani said:

• loans totalling 1.5 million dollars yet to be disbursed were dropped over alleged bribery in the hiring of consultants;
• it has found evidence supporting allegations of bribes and the making of other illicit payments in respect of three consulting contracts entered into by the Indonesian government;
• the loans were made through the Ministry of Public Works with consultants WSP International Ltd. No details were given about the consulting company;
• the bank has also requested refunds worth a total of some 4.6 million dollars which had already been disbursed under the agreements;
• World Bank’s integrity department had received allegations from a contractor that WSP had paid bribes worth 356,703 dollars to government employees in connection with the three contracts.

Incidentally, in May 2005, the World Bank exposed corruption in the implementation of a 203,000-dollar poverty-busting grant in Indonesia and blacklisted five individuals and two firms.