A House team has commenced investigations into how a Chinese firm allegedly inflated the cost of renovating the Kenyatta International Convention Centre (KICC) to Sh3.2 billion ahead of the African Climate Summit held in Nairobi last year.
This emerged after local contractors appeared before the National Assembly Tourism and Wildlife Committee, where they presented their petition for the intervention of Parliament over unpaid dues by the government amounting to Sh674.6 million.
The 14 contractors were brought on board by the Ministry of Defence through the Kenya Defence Forces (KDF) which was overseeing the renovation works ahead of the summit last year.
They carried out 80 per cent of the work while a Chinese firm – China Wu Yi – did 20 per cent of the work.
Mercy Meria, one of the contractors who appeared before the committee, explained that their services were required on a fast-track basis thus they began work before finalising or signing contract documents with KDF.
The Maara MP Kareke Mbiuki-led committee heard that the team comprising architects, project managers, contractors, interior designers, fit-out specialists, furniture suppliers among others delivered their services and handed over the venue by September 4, 2023, but they are yet to be paid.
“We have written to the Ministries of Defense, Environment, Tourism, Foreign Affairs and HOPS seeking an audience on the matter and we are yet to receive a response. Our businesses are now under duress as we have been exposed to our suppliers and financiers. Some of us have received demand letters while others are on the verge of being auctioned,” submitted Meria.
She told the committee that after months of non-payment, KDF called them for a meeting where China Wu-Yi company was present. They were then informed that their payments would be made by the Chinese Firm.
The contractors then claim to have been pushed by the foreign firm to sign unfavorable contracts under duress and then paid 17 per cent of their owed dues.
“To date, we have only received 17 per cent of our payments via China Wu Yi who also informed us in a meeting held between them and ourselves on March 12 that our full payments were dependent on them receiving their full payment of Sh3.2 Billion,” said Mohammed Munyanya, a contractor.
“They have also refused to give us the fully executed contracts for our records and reference,” he added.
The contractors submitted that they were also shocked to find out that the project cost approved by Parliament was Sh1.98 billion and not the Sh3.2 billion that China Wu Yi is using to determine their prorated payments.
“We stand to lose 60 per cent of our payment if the project cost is determined to be 1.98 billion and not Sh3.2 billion because we are on a prorated contract.,” said Meria.
“The situation is extremely dire and we seek your indulgence and intervention to segregate the local contractors from China Wu Yi to enable us to receive our payments in full directly from either KDF or KICC at the earliest time possible. Your consideration of the matter shall be highly appreciated,” she added.
The committee however sought to know the origin of the Sh3.2 billion and involvement of the Chinese firm in the matter and further vowed to come to the aid of the contractors.
“As a committee, we are not aware of any of the Sh3.2 billion contract sums. The information we have is that the project sum was Sh1.94 billion which we as Parliament approved. We will only be able to understand it after we summon China Wu Yi and the Ministry of Defense so they can give us more details,” said Mbiuki
Mwatate MP Peter Shake posed, “Where is this company coming from because it seems like it's here to fleece Kenyans?”
Mbeere North MP Geoffrey Ruku suspected foul play and urged the committee to embark on a fact-finding mission.
“Chin Wu Yi, it seems, is driving local contractors to hell. We should summon the main contractor so as not to allow the local contractors not to be exploited,” said Ruku.
The chairperson consequently ordered the committee secretariat to write to China Wu Yi to appear before the House team next week so they can clarify their contract with KDF and their contract with local contractors.
Notably, the 14 contractors include Flolizz Contractors Ltd which undertook refurbishment works amounting to Sh266.6 million, Michelangelo Ltd which undertook interior design and remodeling works costing Sh80.38 million, Frejed Engineering Ltd which handled supply and installation of air conditioning works amounting to Sh35.19 million and Finetops Enterprise Ltd which was contracted to supply of furniture at a cost of Sh73.25 million.
Homes& Natures Ltd was in charge of landscaping gardening services at a cost of Sh9.57 million, Muga Electricals Ltd was in charge of electrical and CCTV installations works at a contract sum of Sh20.6 million, Global Exhibitions Incorporated Ltd provided green turf carpet at the courtyard at a sum of Sh4.89 million while Straight Media EA Ltd supplied wayfinding signage at a cost of Sh21.089 million.
Further, Bi-son Hygiene Ltd provided deep cleaning services before and after the conference at Sh16.65 million, Barloworld Ltd undertook general repair works, electrical and Perspex works at Sh47.8 million while Kleenchamps Africa Ltd provided deep cleaning and sandblasting services at a cost of Sh6.62 million. Eco Scrub Surface Restoration Company also provided sandblasting services at Sh4.39 million.
Other companies include Industrial Protective Coating Ltd which offered sandblasting services at a contract sum of Sh11.5 million and Johncil World Enterprises Ltd which undertook the facelift of Presidential lounge, VVIP lounge, First Lady’s lounge, and all bilateral rooms on the first floor of KICC at a contract sum of Sh80.05 million.
