ABB to repay S.Africa $100-mln in plant build graft case

A subsidiary of Swedish-Swiss multinational firm ABB will return $100 million corruptly paid to it five years ago for the construction of a power plant, South Africa’s state utility Eskom said Friday

Eskom said in a statement that following “lengthy investigation and negotiations,” a deal had been reached with ABB South Africa for the repayment of 1.56 billion rand ($103-million) related to a contract “unlawfully awarded through corrupt means for work at the Kusile power station”.

State-owned utility Eskom, in its quest to ease pressure on its fleet of ageing and poorly-maintained power stations, commissioned the construction of two coal-fired plants in 2007.

Kusile, east of Johannesburg, was one. But the project was fraught with massive corruption allegations.

President Cyril Ramaphosa last year acknowledged that the problems with the construction of Medupi and its ‘twin’ Kusile station account for much of the financial crisis at Eskom.

Government welcomed the recovery of funds from ABB, calling it “a crucial milestone in the fight against corruption”

“It ensures that companies and individuals found to be complicit in or have benefited from malfeasance at (state owned enterprises) are held accountable,” the Public Enterprises Department said in a statement.

“We are confident that the recovery of the funds from the ABB instance is an indication that government is gradually turning the tide against state capture and corruption in the public and private sectors,” it said.

Despite construction of new power plants, South Africa experiences intermittent power outages, locally known as loadshedding.

sn/cdw