The government, through the Water Ministry, has revealed reasons why it may be forced to maintain a contract with controversial Italian firm CMC Di Ravena in the construction of Itare dam.
According to Water CS Simon Chelugui, the state has been left two reasons why they should not part ways with the construction firm.
First, if the state was to cancel the Ravena tender and re-award it to another firm, it is a very expensive affair and would force Kenyans to dig deeper into their pockets.
The other reason is that by cancelling the contract, the state would lose funding for the project entirely based on the terms agreed on with the Italian Company funding the project.
While awarding the project in 2015, the state acquired a credit from Italy with a pre-condition that the contract be given to an Italian firm.
With the reasons in tow, Chelugui revealed that the state was left with only three options on how to go about the matter.
First, the CS revealed that the state had the option of terminating the contract but that would deny the country funding and even expose it to court litigation.
The other option would be to allow CMC Di Ravena continue with the construction without placing any demands but since the company was declared bankrupt, nothing much would come out of it.
The third option, which is the most preferred, therefore, is retaining the firm but allow it to subcontract to other companies.
"Our strategy here is that we know this fellow is financially bankrupt, he has no capacity to finish the works but we want to insulate ourselves as a client from total collapse...We are retaining the credit with the same contractor just standing there for the face but we know the people who are going to do the work and finish," stated the CS.
The firm had been contracted by Kerio Valley Development Authority in 2017 to construct Arror and Kamwarer dams and billions sent to it as deposit by the National Treasury.
Here is the video Courtesy of Nation:
