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Tuesday 15 Feb 2011

China accused of 'shady bidding'

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Review by The National Audit Office uncovers cut corners in 31 airport projects 

Reports have surfaced that tier-two cities in China have been cutting corners in new infrastructure projects, with some construction companies dodging tax and others breaching contracting regulations.

Respected organisation The National Audit Office undertook a review of airport construction over the past five years, focussing on 31 transport projects across 10 provinces. It was found that five airports in Fujian Province, Fuzhou and Inner Mongolia Autonomous Region had repeated project applications to the sum of 61m Yuan.

In other cases, suppliers working on projects in Chengdu, Daqing, Yulin and Urumqi are thought to have used fake invoices to avoid taxes costing 33m Yuan. Cao Yin of Frost and Sullivan told the Global Times: “It is not rare to see some infrastructure projects [in China] having this kind of violation.”

The National Audit Office noted that 23 airports costing 1.94bn Yuan were not put to public tender as they should have been, issuing the statement: “Relevant government departments are investigating further in accordance with the law and will...find out who is responsible and hold them accountable.”

Corners were also cut regarding environmental issues as the cities expanded at an accelerated speed. Multiple airport projects began construction before the necessary environmental evaluations had taken place while other completed projects were opened before the results of a final environmental assessment were analysed.


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