In a report, Ecuadorian nongovernmental organization Citizenship and Development Foundation (FCD) warns that the corporate structure and presence in strategic infrastructure sectors, such as prison construction, of Puentes y Calzadas Infraestructuras S.L., a subsidiary in Ecuador of state-owned China Road and Bridge Corporation, is a calculated move to strengthen the political influence of China and expand its control in the region.
“The fact that the final beneficiary is an entity linked to the Chinese Communist Party demands greater scrutiny to avoid the possible geopolitical risks that this relationship could bring to the country,” the FDC states in a February report. “It is essential to evaluate not only the company’s technical capacity to execute projects, but also the possible risks associated with dependence on foreign state actors.”
Another aspect the FDC researchers question is the way in which this Chinese company wins million-dollar contracts. In a single process and without apparent competition, the National Service for the Comprehensive Care of Adults Deprived of Liberty and Adolescent Offenders (SNAI) awarded Puentes y Calzadas a $52 million contract to build the El Encuentro prison in the Santa Elena province, Ecuadorian magazine Vistazo reported.
In a move that did not go unnoticed, Puentes y Calzadas was invited to bid for the construction of a mega-prison in Archidona, Napo province. The indigenous people of this Amazonian region, home to an ancestral cultural heritage, protested. In December, they blocked access to the province’s main roads and took control of the Governor’s Office, Spanish daily El País reported.
According to local daily Primicias, construction was halted in December. In January, surprisingly, Ecuador’s Official Public Procurement System declared the contract for the construction of the Archidona prison void, “because it is unfavorable to national interests.”
“The [construction] process for Archidona was declared void because there was a breach of contract, for reasons attributed to the winning tenderer. This means that the government awarded the contract, asked them [Puentes y Calzadas] for the required qualifying documents, but they did not comply,” José Morán, a public procurement expert at Ecuadorian firm Morán Consultores, told Diálogo. “Something happened; it hasn’t been published and it’s not clear. But something happened.”
Both the El Encuentro and Archidona prison contracts lack transparency, having been declared confidential with no access to information containing characteristics or technical specifications of the works that involve the Chinese company, Spanish media Economía Digital Galicia reported. “Only if the documents were published would it be possible to see if this corresponds to any international cooperation agreement,” Morán added.
In the case of Archidona, “Puentes y Calzadas could be declared a failed bidder and, therefore, would not be able to bid again in Ecuador for at least three years. To sign a contract, you have to provide performance guarantees of good use of advance payment, and documents must be submitted,” Morán said. “That’s the part that corresponded to the supplier: to comply in order to sit down and sign the contract. That’s what Puentes y Calzadas did not do, but it’s not transparent.”
According to local media investigations, Puentes y Calzadas has a history of controversy in Ecuador, ranging from allegations of illegal property purchases to irregular procedures in the projects it carries out for the State. “As such, its success in winning tenders raises questions,” Morán concluded.
