The contract to be signed by the DRC government and DPW for the construction and operation of the Banana port is expected to create a corporate structure, allowing the personal enrichment of several political figures, including Congolese President Kabila. The whole of the negotiations, on a project exceeding one billion US dollars, would be tainted with corruption.
The construction of a deep-water port in Banana, the only part of the Congolese territory with direct access to the Atlantic Ocean, has been in the plans for years.
In 2015, the DRC government began looking for an operator for a construction project for a floating dock at the coastal town of Banana. Several companies were approached, including the French company NECOTRANS.
On March 23rd, 2016, Jean-Phillipe Gouyet, CEO of NECOTRANS, and Suhail Al Banna, CEO of DPW Africa and the Middle East’s department, sent a letter to the Organisation d’Equipement Banana Kinshasa ("OEBK"), a Congolese public authority in charge of developing the Banana-Kinshasa corridor. The letter expresses the interest of the DP World / NECOTRANS consortium for building the Banana floating dock project. ( Annex 1 letter of 23.03.16 sent by DPW NECOTRANS to the OEBK)
Following this letter, the DRC government entered direct negotiations with DPW, without NECOTRANS, for the construction of the floating dock. Since no call for tenders had been issued, as it is required by Congolese law, the authority in charge of public markets issued a special permission for the OEBK to negotiate with DPW without calling for tenders.
Following the beginning of the negotiations, the parties agreed on a bigger project: the construction of a real deep-water port. A new authorization to override the call for tenders has not, at PPLAAF’s knowledge, been issued for the deep-sea port project.
Moise Ekanga, executive secretary of the Sino-Congolese Program Monitoring Office, and a close associate of President Kabila, was allegedly involved in the negotiations from the beginning. Ekanga allegedly requested direct talks with Sultan Ahmed Bin Sulayem, CEO of DPW, to secure President Kabila's personal interests. Ekanga has allegedly visited Dubai for that purpose.
Congolese businessman Claude Makoso has also visited Dubai on March 27th, 2016 to meet the CEO of DPW.
In the summer of 2016, DPW representatives traveled twice to the DRC to negotiate the contract between the parties. DPW's delegations included Jamal Majid Bin Thaniah, DPW’s vice-president and Group CEO of Dubai world, Dubai’s investment company whose assets include DPW, and Tarik El Farouki, DPW Director of Development in Africa.
Following the first negotiations, President Kabila allegedly told Ekanga that he wanted a guarantee that he would have a personal profit from the construction and operation of the port.
On October 4th, 2016, in this context, Sultan Ahmed Bin Sulayem addressed a letter to President Kabila. This letter was sent to Ekanga, who allegedly brought it to the president. This letter ensures the intention to grant a percentage of the capital of the company that will build the port to a new Congolese state company. ( Annex 2 letter of 04.10.16 sent by the Sultan to President Kabila):
This letter was accompanied by an appendix which presents the different hypotheses for involving a private company in the case, presumably at the discretion of President Kabila: ( Annex 3 comparison of hypotheses A & B corporate structure)
Hypothesis A would propose to involve private shareholders in the concessionary company (“Privé”), which would de facto be a company benefiting to Kabila’s inner circle. According to the whistleblowers, this option was not the preference of DPW because it could have raised doubts about corruption.
Hypothesis B proposes to give 40% of the managing company (“Gestionnaire”) to this private company. The "Privé RDC" may be a company ultimately owned by President Kabila.
According to PPLAAF’s sources, hypothesis B to hold a private company up to 40% in the managing company has been retained.
The first memorandum of understanding was signed on January 3rd, 2017, by José Makila, DRC’s Deputy Prime Minister and Minister of Transport, on the bases presented above ( Annex 4 MOU of 03.01.17). Then, on February 9th, 2017, the memorandum of understanding is officially signed by José Makila and Suhail Al Banna. ( Annex 5 MOU of 09.02.17)
Following the signature, DPW opened a subsidiary in the DRC, headed by Claude Makoso. Makoso is expected to be the director of the company responsible for the construction of the port.
Claude Makoso had already been involved in negotiations regarding the construction and management of the Matadi private port. He is reported to have been involved in the creation, alongside Philippine company International Container Terminal Services, President Kabila and Lengo Property Management Company (SIMOBILE), owned by Congolese businessman Jean Lengo dia Ndinga, of the ICTSI DR Congo SA joint venture.
For this joint venture to have the license to operate the port, the Filipinos and Jean Lengo dia Ndinga would have allowed Kabila to own a part of it. Jaynet Kabila, the president's sister, has allegedly orchestrated the deal. Kabila would therefore be a partner in this consortium via the Investment and Investment Company (SIP). This company is represented on the joint venture’s board of directors by Jean Lengo dia Ndinga.
On February 15th, 2017, Al Banna sent a letter to Makila to thank him and send a detailed work plan for a period of six months. ( Annex 6 letter of 15.02.17 sent by Al Banna to Makila, Annex 7 work plan)
The Parisian law firm Carbonnier Lamaze Rasle & Associés is alleged to have worked with DPW on the drafting of the contract.
During the month of June, the parties met in the DRC to finalize the contract. The last round of negotiations likely took place between June 31st and July 4th, 2017. The DPW delegation was made up of DPW's head of legal department Olivier Schwartz and El Farouki. The delegation mainly negotiated with Ekanga.
Al Banna sent another letter to Makila on July 17th, 2017, to report on the progress of negotiations and feasibility studies, as well as to request an extension of the two-month exclusivity period, and thus to delay the signing of the contract, scheduled for August 9th. ( Annex 8 letter of 17.07.17 sent by Al Banna to Makila)
On October 5th, 2017, Makila traveled to Dubai to visit DPW's premises in light of the imminent signature. ( Annex 9 « Renforcement de coopération entre la RDC et les Emirats Arabes Unis », Congolese Press Agency, 05.10.2017 )
As described in Al Banna's letter, the parties postponed the signing date by a few months. The new date would have been October 28th, 2017. This date was also delayed as the portfolio minister, Wivine Mumba Matipa, has allegedly refused to countersign.
The DPW delegation arrived in October and included Anil Wats, Chief Operating Officer of DPW, and El Farouki. President Kabila allegedly received them on October 28th at 10 am to announce the delay in signing, and to assure them that the contract would be signed later. This decision to postpone the signature was taken at the last minute as invitations to attend the signing had already been sent to officials ( Annex 10 Program of the signing ceremony)
The project concerns the construction and management of a port and free trade area in Banana at a cost of more than 1 billion US dollars. The first planned phase is the construction of a 1,500-meter wharf on the coast of the Atlantic Ocean. The DRC has an entrance to the ocean to the Congo River. The cost of this first phase is approximately 396 million US dollars (see p.98 of the Feasibility Study). ( Annex 11 market and feasibility study of 21.09.17)
DPW would have liked to start the construction in the blue square. But President Kabila would have insisted on starting in phase 1, red square, and then progressing to phase 2, yellow square.
The construction of the port would be accomplished by a Chinese company, Guang Ping International. Guang Ping is alleged to have already signed a logistics contract with Alain Wan's company, MW Afritec, to use the latter's private port located on his quarry near Boma for construction. Alain Wan, a Belgian-Congolese businessman, has already been pinpointed by PPLAAF, Le Monde, and the Organized Crime and Corruption Reporting Project (OCCRP) as one of the instigators of a vast fraudulent system combining several front companies to spend public money for the private interests of Ferme Espoir, a company owned by President Kabila.
The feasibility studies and the environmental study have been approved by the parties.
The Concessionary Company
The public will know that a joint venture, called during the negotiations "Port Autonome de Banana", will be created by a Congolese state company and DPW. This joint venture should then enter into a concession agreement with the DRC government. The state company in the joint venture should have logically been one of the Congolese public authorities in charge of the ports (the National Transport Office of the Democratic Republic of Congo or the OEBK), but they have been allegedly put aside in favor of this new state entity.
It is the joint venture "Port Autonome de Banana" that should own the concession. It would be a limited company, under Congolese law, owned 30% by the State of DRC or the new state entity to be created, and 70% by DPW. The parties would have initially negotiated a split of 25% for the DRC and 75% for DPW, but it is a 70/30 split that would have been accepted.
The structure of this company was established in the memorandum of understanding, p.5:
The State-owned Company within the Concessionary Company
The state-owned company in the joint venture is expected to be 51% owned by the Congolese state. DPW would not sign the contract, according to the whistleblowers, if this state company is not at least 51% owned by the Congolese state.
According to the whistleblowers, the remaining 49% will belong to a nominee of President Kabila or to a Congolese private company in which Kabila has shares directly or indirectly.
The president could, therefore, earn profits not only on the 40% of the managing company but also on the 49% of this state company. Given that the identity of the company holding the 51% is not yet known, it is possible that President Kabila also benefits from it by creating a new state company.
The contribution of the DRC, as agreed in the aforementioned memorandum of understanding, may be "in kind", that is to say by the granting of land and tax exemptions. Simply put, in exchange for land owned by the Congolese state, President Kabila, thanks to the 49% of the Congolese company owning 30% of the joint venture, could draw from this contract a large profit.
The Managing Company
The managing company would, therefore, be a "subsidiary of DPW", owned 40% by a private company, presumably for President Kabila’s benefit.
Of the 100% of revenues that will be generated during the operation, the managing company would receive 15% gross. This 15% will then be divided between DPW (60%) and the private company that would be partially owned by President Kabila. This private company will be created by the presidential adviser to the Republic and current director of the Insurance Regulatory Authority Alain Kaninda, and owned by President Kabila and the Sultan. (See annex hypotheses ).
According to the document presenting the assumptions to President Kabila, such an arrangement would allow the "privé DRC" to earn more than 45.3 million dollars in seven years.
The DRC does not contribute financially to the project. In addition to administrative facilities and tax exemptions, the DRC's contribution of 30% mainly consists of land grants.
See the Memorandum of Understanding, p.2:
The DRC would, therefore, intend to expropriate all the entities to which the land belongs for the development of the port:
- the OEBK, in accordance with the ordinance of March 28th, 1972, n ° 072-184 creating the OEBK and which allot to it the lands of the project,
- The Army
- The Ministry of the Environment, the peninsula being perceived as a tourist area,
- The National Office of Transport, which owns a 75 meter quay,
- Several private persons.
Oil company Perenco and a Chinese fishing company are also present on the ground.
The Length of the Concession
DPW would have asked for 50 years of concession. While the standard is to base the duration of the concession on an economic study, DPW would have asked for this duration without proving it based on similar projects in the market.
Possible Infractions of Congolese LawThis case includes some potential violations of Congolese law. In the first place, there was no call for tenders under the Code of Public Procurement (see Articles 17, 41 and 42 of the Code of Public Procurement). Secondly, the alleged remunerations of public officials are punishable under the Corruption Act (Articles 147-150). Officials with more information about this issue are encouraged to contact PPLAAF.
- Annex 1 letter of 23.03.16 sent by DPW NECOTRANS to the OEBK
- Annex 2 letter of 04.10.16 sent by the Sultan to President Kabila
- Annex 3 comparison of hypotheses A & B corporate structure
- Annex 4 MOU of 03.01.17
- Annex 5 MOU of 09.02.17
- Annex 6 letter of 15.02.17 sent by Al Banna to Makila
- Annex 7 work plan
- Annex 8 letter of 17.07.17 sent by Al Banna to Makila
- Annex 9 « Renforcement de coopération entre la RDC et les Emirats Arabes Unis », Congolese Press Agency, 05.10.2017
- Annex 10 Program of the signing ceremony
- Annex 11 market and feasibility study of 21.09.17
- Annex 12 Report of the Council of ministers of February 21st, 2018