The government of Ethiopia has fired a big state company from the project to build the 6,450MW Grand Ethiopian Renaissance Dam (GERD), the country’s most important construction project, citing tardiness.
Interpreted as a sign of new Prime Minister Abiy Ahmed’s determination to clean up politics and balance ethnic interests, the decision is a blow for the military-run Metals and Engineering Corporation (Metec), which held the contract for mechanical and electrical work, including installing turbines.
Abiy told reporters on 25 August he had cancelled Metec’s contract, citing complaints of lengthy delays made by dam’s main contractor, Italy’s Salini Impreglio.
"It is a project that was supposed to be completed within five years, but seven or eight years later not a single turbine is operational," Abiy told a news conference in Addis Ababa, reports Reuters.
"Salini has even demanded compensation because of the delays," Abiy said. "We decided to cancel a contract with Metec and offer companies with experience. Otherwise, it will take even longer," he added.
According to The Financial Times, Metec is perceived in some parts of the country as a tool of Ethiopia’s former governing elite, which had been dominated by the small Tigrayan ethnic group, represented by the Tigrayan People’s Liberation Front (TPLF).
Founded in 1970, Metec is Ethiopia’s biggest industrial company with interests in engineering, construction, arms manufacture and even sugar refining, reports the Financial Times.
One local analyst told the FT the sacking of Metec was "very significant".
The company, said Hallelujah Lulie, a regional security analyst based in Addis Ababa, had been "functioning without financial accountability and transparency. There have been serious examples of mismanagementâ€‰.â€‰.â€‰.â€‰and serious concerns about its capacity to undertake this kind of project."
Lulie told the FT: "The cancellation of the contract further demonstrates the declining power of TPLF and the emerging role of the government in controlling the military."
Situated on the Blue Nile, the GERD dam has been under construction since 2011 and is reported to be about two-thirds complete.
It has sparked diplomatic tensions with Egypt, which worries about its water supply, but expressions of good will have marked recent talks since Abiy Ahmed came to power.
The dam will dramatically increase the country’s power generation capacity, and Ethiopians see it as central to Ethiopia’s development and prestige.
In July, the unexplained shooting of the project’s chief engineer, Simegnew Bekele, drew large crowds of protesters.
Image: The Grand Ethiopian Renaissance Dam, under construction on the Blue Nile, will be the largest hydroelectric power plant in Africa (http://www.geosociety.org/)