The ABC of exercising influence

11 February 2017

Writing in the business newspaper Gestión, Manuel Romero Caro outlines the various strategies used by Odebrecht (and probably other companies of the same ilk) in influencing government decisions in its favour. Herewith a much abbreviated version; for the full version, click here. More promised for next week.

  1. Offering money to pay for election campaigns, enabling the companies to position themselves favourably well in advance of any bidding.

  2. Securing favourable legal frameworks, in the Peruvian case bypassing the National System for Public Investment (SNIP) through decrees stating ‘public necessity’ and ‘the national interest. Prior to 2006, Odebrecht had been banned from tendering for projects in Peru, but the ban was waived by the Toledo government.

  3. Failing to prioritise projects and constantly changing the rules of the game, the history of the gas pipeline to southern Peru being a prime example. Endless delays had the effect of raising the cost disproportionately.

  4. Failing to adopt clear-cut and logical procedures for awarding contracts.

  5. Using political influence, especially within Proinversión, to give companies like Odebrecht an unfair advantage over rivals in the awarding of contracts.

  6. Devising bespoke arrangements for companies and pursuing projects with doubtful returns.

  7. Bumping up the cost of projects after the signing of contracts through subsequent amendments. This follows on from accepting inadequate pre-investment studies into the true costs involved.

 

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