JAISWAL
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Why Contract Gifts in China Do Not Work | Top Secret Writers
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If you read my article earlier this week on the
practice of Guanxi in China – then you know that I
was left with a very bad taste in my mouth after
personally experiencing the behavior.
In this update, I would like to share a story about
a bridge contract in China. It was a contract won
by China Railway No. 9 Group"¦but what
happened after the contract was won is
something that most people outside of China
would likely consider considerably unethical.
A few years ago, a bridge was needed Jilin, China.
The cost of the project was 2.3 billion RMB, or
nearly U$360 million. The bridge was lengthy at
74.1 km long, and was to be a crown project for
the area.
Bids were tendered, and a winner was
announced. A bit later, construction began on this
"bridge".
Up to this point, this story sounds like business
as usual, but remember that in China, not all is
that it appears to be.
The Bridge Construction Sub-Contractors
Upon winning the bid, China Railway No. 9 Group
Company subsequently sub-contracted the work
out to various other parties.
Per Chinese law, China Railway No. 9 Group
Company was responsible for following up with
all of the work and the quality of the
subcontractors, a thing that they may have
forgotten to do.
As the story goes, one of the sub-contractors
hired by No. 9 group was Jiangxi Changsha
Construction.
Unfortunately, the company was not the really
"Jiangxi Changsha Construction", but allegedly a
group of "thieves" and con men. And it only gets
worse.
This group of con men allegedly subcontracted
the work out to villagers and itinerant laborers
with no bridge building experience. One of the
leaders of the itinerant group was a man named
Lu who was actually a cook by trade.
Mr. Lu claimed that although he had no
experience, it was not a problem because many
sections of the bridge were made by groups of
men such as himself. And further investigation
bore out this news.
According to the locals, they were even paid to fill
the "supporting pillars'" with rocks and small
stones before a wet sand mixture was applied.
The sand and stones were utilized in lieu of
concrete, a thing the chef either did not know
how to properly use, or could not afford.
The Story Breaks
The Beijing News broke the story and supposedly
possesses video of excavators dumping rocks
into pillars when the on-site inspectors were off
duty. The villagers who saw and took part in the
bridge building process stated that they would
never ride on any train going over that bridge.
Upon hearing of the mess, China Railway No.9
Group said that they may not have done the
appropriate level of due diligence.
They admitted that they did not even verify the
qualifications of all the subcontractors, including
the one which hired the chef.
Their reason for not scrutinizing the group was
that the group was highly recommended by a
chief of the railway bureau.
The enormity of this story is beyond belief, and
shows the depth and breadth of corruption here.
When project contractors are chosen based on
how much one can skim off the top, the project
is destined to flop or may even be fatal. When so
many people have their hands out and so many
more willing to fill it with coin, it's little wonder the
quality of Chinese projects is often suspect at
best.
Why Bribery pays in ChinaAnother way to look at it – just how much of all
of the new investments that that the U.S. has paid
out to China has deviated from the path of project
into the hands of local corrupt officials?
I wonder how much of the $30 to $ 40 billion
dollars that went into the Olympic projects
actually made it to the intended project? In a
country like China, no one really knows.
Perhaps what bribery means in China can best be
summed up by the words of Qiu, a friend of
mine who works with the Chinese government.
Part of her responsibility is to investigate
corruption throughout the countryside. When I
asked her about corruption in China, she said,
"You can consider this as chances or
opportunities"¦"
Interestingly enough, before finishing this article, I
was asked to recommend someone for another
project.
I did as was asked, and recommended a Chinese
company that I knew of. Within moments of
appraising them of the new business, they
quickly sent me a text stating that if they won the
business, they would split the profits 50-50 with me.
Such is business in China.
.
.
.
.
If you read my article earlier this week on the
practice of Guanxi in China – then you know that I
was left with a very bad taste in my mouth after
personally experiencing the behavior.
In this update, I would like to share a story about
a bridge contract in China. It was a contract won
by China Railway No. 9 Group"¦but what
happened after the contract was won is
something that most people outside of China
would likely consider considerably unethical.
A few years ago, a bridge was needed Jilin, China.
The cost of the project was 2.3 billion RMB, or
nearly U$360 million. The bridge was lengthy at
74.1 km long, and was to be a crown project for
the area.
Bids were tendered, and a winner was
announced. A bit later, construction began on this
"bridge".
Up to this point, this story sounds like business
as usual, but remember that in China, not all is
that it appears to be.
The Bridge Construction Sub-Contractors
Upon winning the bid, China Railway No. 9 Group
Company subsequently sub-contracted the work
out to various other parties.
Per Chinese law, China Railway No. 9 Group
Company was responsible for following up with
all of the work and the quality of the
subcontractors, a thing that they may have
forgotten to do.
As the story goes, one of the sub-contractors
hired by No. 9 group was Jiangxi Changsha
Construction.
Unfortunately, the company was not the really
"Jiangxi Changsha Construction", but allegedly a
group of "thieves" and con men. And it only gets
worse.
This group of con men allegedly subcontracted
the work out to villagers and itinerant laborers
with no bridge building experience. One of the
leaders of the itinerant group was a man named
Lu who was actually a cook by trade.
Mr. Lu claimed that although he had no
experience, it was not a problem because many
sections of the bridge were made by groups of
men such as himself. And further investigation
bore out this news.
According to the locals, they were even paid to fill
the "supporting pillars'" with rocks and small
stones before a wet sand mixture was applied.
The sand and stones were utilized in lieu of
concrete, a thing the chef either did not know
how to properly use, or could not afford.
The Story Breaks
The Beijing News broke the story and supposedly
possesses video of excavators dumping rocks
into pillars when the on-site inspectors were off
duty. The villagers who saw and took part in the
bridge building process stated that they would
never ride on any train going over that bridge.
Upon hearing of the mess, China Railway No.9
Group said that they may not have done the
appropriate level of due diligence.
They admitted that they did not even verify the
qualifications of all the subcontractors, including
the one which hired the chef.
Their reason for not scrutinizing the group was
that the group was highly recommended by a
chief of the railway bureau.
The enormity of this story is beyond belief, and
shows the depth and breadth of corruption here.
When project contractors are chosen based on
how much one can skim off the top, the project
is destined to flop or may even be fatal. When so
many people have their hands out and so many
more willing to fill it with coin, it's little wonder the
quality of Chinese projects is often suspect at
best.
Why Bribery pays in ChinaAnother way to look at it – just how much of all
of the new investments that that the U.S. has paid
out to China has deviated from the path of project
into the hands of local corrupt officials?
I wonder how much of the $30 to $ 40 billion
dollars that went into the Olympic projects
actually made it to the intended project? In a
country like China, no one really knows.
Perhaps what bribery means in China can best be
summed up by the words of Qiu, a friend of
mine who works with the Chinese government.
Part of her responsibility is to investigate
corruption throughout the countryside. When I
asked her about corruption in China, she said,
"You can consider this as chances or
opportunities"¦"
Interestingly enough, before finishing this article, I
was asked to recommend someone for another
project.
I did as was asked, and recommended a Chinese
company that I knew of. Within moments of
appraising them of the new business, they
quickly sent me a text stating that if they won the
business, they would split the profits 50-50 with me.
Such is business in China.
