From: Biniam Haile \(SWE\) (eritrea.lave@comhem.se)
Date: Mon Sep 14 2009 - 17:13:47 EDT
Monday, Sept 14, 2009 11:11 pm
Italian Company Disappoints Ethio-Djibouti Officials
Company requests extension of time and funding in order to complete
project.
The rehabilitation of a 114Km segment of the Ethio-Djibouti railway has
been suspended after the Italian company which had been undertaking the
project since 2007 had disappointed the governments of Ethiopia and
Djibouti by asking for more time and money when it was expected to
deliver the project two months ago in June.
Consta Joint Venture (CJV), a subsidiary of Italian Consta Consortium,
was awarded the project in 2006, and started operation in 2007 under the
supervision of a Spanish consultancy firm, INECO-SPT. Its sudden request
came two months before the expected due date of the project. Worse yet,
Consta had rehabilitated only five kilometres of rail, which was not
accepted by the consultant for quality reasons.
The European Union ordered the suspension of the project following the
development, instructing proper protection until a solution is found to
the problem, a source told Fortune. The project was enabled by a 50
million euro (924.5 million Br) fund provided by the EU.
Ethio-Djibouti officials have set a tentative appointment for the end of
this week to discuss the issue in Djibouti. The date has not yet been
fixed due to the Ethiopian New Year resting on Friday. They are expected
to meet EU officials in Brussels next week to reach a decision,
according to the source.
The railway covers a distance of 781Km. The segment given to Consta,
which crosses the Metehara area, was more damaged by age and by the
Ethio-Somalia conflict in the 1970s. Consta had wanted to deliver the
five kilometres as a job done but the consultant,unhappy with the
quality of the work, refused to accept it, according the assessment in
the report by INECO-SPT.
INECO-SPT is the third consultancy firm that has been involved in this
project. The first was ETACIK which finalized its study 10 years ago. A
second consultant, AFRICO of South Africa, was recruited in 2002 to
revise the first study because a long gap was created before the
projected could be implemented. AFRICO presented its report in 2005 in
which it recommended that the project needed 50 million dollars, 10
million more than what the European Union had expected.
Further delays occurred after that. Consta was recruited to rehabilitate
the rail in November 2006, and it would wait until 2007 to mobilize
resources before it could begin operation. The two year gap created in
this process had created a discrepancy between AFRICO's study and the
situation on the ground.
Clari Guido, the Consta project manager was not available for comment as
he was said to be in Italy.
However, when Consta began operation, they found that the design given
by the consultant and the actual rail on the ground had diverged, a
source within Consta revealed to Fortune.
It was following Consta's complaints that INECO-SPT was brought on board
for a 700,000 euro fee to complete its work inside of six months,
according to the Consta source. He complained that a year later, the
Spanish consultancy firm had not completed its project.
Consta's request for the 18 months of extra time and additional money
emanated from such problems, the source said.
The representatives of Ethiopia and Djibouti will discuss whether to
comply with Consta's requests or to hire another company. They will
discuss the matter with EU officials after they have reached an
agreement.
By WUDINEH ZENEBE
SPECIAL TO FORTUNE
http://addisfortune.com/Italian%20Company%20Disappoints%20Ethio-Djibouti
%20Officials.htm