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Hong Kong targets construction corruption

OUTLAWING CORRUPTION in Hong Kong's construction industry is to be made a priority in 1999 as the region prepares for a major road and rail projects bonanza over the next few years.

Initiatives will include corruption prevention reviews to help clients put in place robust systems and procedures. The Independent Commission Against Corruption is also forging partnerships with professional bodies and trade associations, to raise awareness and enlist support.

Reports of corruption in construction rose 37% in the first 10 months of 1998, compared to 1997. However this may reflect the publicity generated by high profile piling fraud cases such as that uncovered last year at Hong Kong Station. A number of people now face trial charged with bribery and conspiracy to defraud in connection with substandard foundations on this project.

'Construction is always a high risk area. There is so much money involved and public safety may be affected if a corrupt deal is struck,' said ICAC director of corruption prevention Thomas Chan. ICAC believes construction warrants particular attention now as major infrastructure projects worth 32bn are planned to start in the next few years.

ICAC will be targeting specific government work areas such as housing and land development. It wants to ensure that tendering procedures are open and handled properly.

Supervision, workmanship and material quality are also a concern, particularly with multi-tier subcontracting. 'At each layer the profit margin becomes thinner. Some probably can't make a profit without cutting corners. It is very important for the client to keep an eye on suppliers,' said Chan.

But fears that Hong Kong's return to China would lead to a substantial rise in corruption have failed to materialise, said Chan. Certainly the situation hasn't got any worse in the public sector, he said, but it is harder to say in the private sector, particularly with the downturn in the economy.

Hong Kong remains one of the most corruption free cities to do business with in the region, and ICAC has maintained its independence backed by a strong legal framework, reflecting the government's continued desire to fight corruption, said Chan. 'Prevention is better and cheaper than cure.'

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