EMBASSY COMMENTS ON NO.1 CONTRACTING OPIC

UNCLAS KINSHASA 001506 SIPDIS SENSITIVE AF/C FOR THOMAS GALLAGHER, DEPT FOR OPIC - CONAL DUFFY AND JIM WILLIAMS E.O. 12958: N/A TAGS: ECON EINV ELTN CG OPIC SUBJECT: EMBASSY COMMENTS ON NO.1 CONTRACTING OPIC APPLICATIONS REF: DUFFY-NEWMAN EMAIL 07/19/04 ¶1. (U) Sensitive but Unclassified, Privileged Business Information. Not for internet distribution. ¶2. (SBU) Embassy Kinshasa has reviewed the two applications for political risk insurance that No.1 Contracting Corporation of Ashley, PA has submitted to OPIC. Post opines that there are no current political or economic difficulties associated with either the company or the two projects. Both bids that No.1 Contracting submitted are for World Bank funded infrastructure rehabilitation and reconstruction projects. Hence, the source of funding is guaranteed. DRC treatment of foreign contractors varies, however, the bid process for such projects is carried out according to World Bank norms. Once commencing the project, the contractor will likely encounter some bureaucratic delays possibly related to licensing and authorization, taxes, and/or relationships with local chieftains. Logistical difficulties (e.g. consistent supply of gasoline, cement, etc) will further complicate project success. ¶3. (SBU) The following reesponds to the specific questions listed in the referenced email: a. Post does not foresee any negative public or host government sentiment toward the projects. b. The projects are unlikely to have negative impacts on U.S. policy and interests in the DRC. c. Post has no knowledge of accusations of improprieties on the part of No.1 Contracting. d. Post does not believe that the projects could potentially result in serious adverse environmental effects beyond those normally encountered in heavy construction projects. e. These projects fall under the World Bank's Emergency Multisectoral Reconstruction and Rehabilitation Plan. Hence, they are not in conflict with the DRC's economic objectives and welfare. f. Post is unaware of potential uneconomic use of raw materials or labor. g. These projects will not have an adverse affect on the DRC's balance of payments. The whole of funding is provided by the World Bank. ¶4. (U) Please direct questions regarding OPIC applications that need Embassy Kinshasa assistance to Peter Newman. IVG: 934-2234, Cell: (243) 81-700-4428, Email: NewmanPD@state.gov MEECE