White List of best players begins to take form following World Bank/IMF meeting

By bne IntelliNews July 9, 2013

By PK Semler

WASHINGTON (CI MENA) - The idea of creating a White List of the best players and practices in cross-border private investment in frontier markets started taking form following the World Bank/International Monetary Fund annual spring meeting held in Washington, DC.

The concept of a White List that Ministers, State-owned enterprises and private sector owners can access followed a discussion here about the possibility of sharing names of black listed individuals and companies between the World Bank and affiliated groups such as the International Finance Corporation and private sector companies.

During a panel on “Corruption and Public-Private Partnerships: Challenges and Solutions,” the issue of a global black list was raised by IFC vice-president for Global Industries Rashad Kaldany, Electricite de France (EDF) vice-president for Governance Jean-Baptiste Siproudhis, Standard Chartered Bank Director of Project Finance-Americas Paul Clifford, and World Bank managing director for Integrity, Sri Mulyani Indrawati.

Siproudhis asked whether it would be possible for a company such as listed French energy giant EDF to share its list of black listed companies with those of the World Bank and other private groups such as Standard Chartered  to avoid doing business with either corrupt government officials and/or “consultants.”

While it was agreed that a global black list would be difficult for legal reasons, a White List of companies, lawyers, bankers and consultants who have done successful business operations in developing markets would be a welcome tool.

IFC chief executive and former investment banker Jin-Yong Cai said such a list would be very welcome as it would give countries a transparent benchmark for choosing companies and advisors for projects and contracts.

Also very supportive of such a White List is Nigerian Finance Minister Ngozi Okonjo-Iweala who believes that all African government and finance ministers need to share such critical knowledge to improve outcomes, especially in PPP projects.

During the IMF-World Bank meeting, Mr. Cai chaired the standing room only ceremony awarding the top 40 Public-Private Partnership projects around the world such as the Queen Alia airport and Virginia-based AES power plant project in Jordan and the New York City-based EleQtra wind farm project in Cape Verde.

Standard Chartered’s Clifford said a White List naming projects, companies, banks and law firms would go a long way to avoiding corruption and failed projects in already difficult markets.

Following an off-record meeting at the Atlantic Council with Libyan Central Bank Governor Saddek Omar Elkaber, World Bank senior advisor and Libyan national -- Hafed Al-Ghwell – initially said such a White List could be an important tool for Libya as they seek foreign partners to rebuild their infrastructure and kick-start private sector investment.

The meeting with the Central Bank governor included Central Bank Board member Tarik Mohamed Yousef Magariaf, JP Morgan managing director Ahmed Saeed and Citigroup government affairs head Charles Johnston.

The World Bank’s black list can carry very heavy penalties as the Montreal, Quebec based construction giant SNC-Lavalin can easily attest after the World Bank announced that it has banned its 100 affiliates from doing business with the bank for a ten year period due to company misconduct in relation to the Padma Multipurpose Bridge Project in Bangladesh.

SNC spokeswoman Leslie Quinton was not able to say whether the company will aggressively pursue some billions of dollars of infrastructure projects that SNC has on hold following Libya’s Feb. 17 revolution.

The major corruption scandal was triggered by SNC Lavalin former Tunisian head of construction Riadh Ben Aissa and led to the firing and replacement of both the company executive management and much of its board of directors.

Siemens AG’s Managing board member and general counsel Peter Solmssen told a previous World Bank/IMF meeting that the German industrial giant is now doing much more business and has higher profits today by following best business practices than it did when it was involved with corrupt practices some five years ago.

However, Libya has taken tremendous strides led by the Central Bank and Planning Department by carefully reviewing all contracts signed by the previous regime for compliance.

Libyan Finance Minister Dr. A. El Kilani speaking at a meeting hosted by the Willkie Farr & Gallagher law firm in Washington said the Libyan government is upholding all contracts that are in the best interest of Libya and its people.

Just prior to the meeting at Willkie, Minister El Kilani said he had just met with Assistant Secretary of State for Economic Affairs Jose W. Fernandez regarding the signing of a bilateral agreement with the US Overseas Private Investment Corporation.

The bilateral OPIC agreement would give US companies political risk coverage and at the same time allow OPIC to invest up to USD 250m in Libyan private sector projects. 

Published in collaboration with Capitol Intel Group (www.capitolintelgroup)

Contact the reporter by phone at +12025493399

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