Fresh probe into Chinese firm over funding Rajapaksa family
Jul 14, 2018 19:25 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT – The Inland Revenue department has been asked to investigate payments from a Chinese company to a private fund linked to former president Mahinda Rajapaksa's family amid allegations that Beijing funded his failed re-election bid.
Finance Minister Mangala Samaraweera said the IRD will probe the payment of nearly 20 million rupees to the Pushpa Rajapaksa Foundation of former minister Economic Development minister Basil Rajapakasa’s wife Pushpa.
The Chinese-controlled Colombo International Container Terminals Limited (CICT) said on Thursday that it paid the rupee equivalent of 150,000 dollars to Pushpa’s foundation as part of the company's "corporate social responsibility."
“I am asking the Inland revenue department to investigate the Pushpa Rajapaksa Foundation, if they built the houses (as claimed by the Chinese company), “ the minister told reporters in Colombo on Friday.
Deputy Minister Ranjan Ramanayake has already lodged a complaint with the Financial Crimes Investigation Division about the CICT payment to the Rajapaksa Foundation.
The authorities are being asked to look into if there had been any accounting fraud at the CICT, where the Sri Lanka Ports Authority holds a 15 percent equity stake. The company had allegedly shown the donation as an expense charged to the company.
The CICT’s admission of giving money to foundation came after deputy minister Ranjan Ramanayake published a copy of a cheque for nearly 20 million rupees made out by CICT to the foundation on May 21, 2012.
The Chinese company said the money was for housing the poor, but it did not identify the poor or say how many homes were to be build the money. Instead, the CICT said it did not supervise what was done with the cash.
"Once funding is allocated, CICT believes that the funding so allocated would be utilised for the said projects by the receiving agencies, without CICT having to play a supervisory role as to the implementation of such projects."
It also said that the payment to the Rajapaksa foundation was made "long after" the "project concession agreement" was signed and construction of the CICT terminal began. "We therefore categorically reject the implication that the payment is tantamount to a bribe," it said implying that only money given before signing an agreement would amount to a bribe.
The Chinese funding for the Rajapaksa foundation came shortly after the New York Times renewed allegations that the Mahinda Rajapaksa campaign received millions of dollars from Chinese state-owned companies.
Campaign donations are not illegal, but if a foreign entity is funding a political party or an individual it would amount to an external interference in local politics and could also trigger money laundering charges.
The Times also accused China of pushing Sri Lanka into a debt trap.
However, last week, the Chinese embassy in Colombo vowed to keep providing financial help, including loans, to Sri Lanka under its massive "Belt and Road" infrastructure plan.
Dismissing "Western media" claims of a "debt trap", the embassy also rejected the Times' report about alleged corruption in Chinese projects.
However, neither the embassy nor the Chinese company concerned, the China Harbour Engineering Company, have explained the payments specified in the Times report. (COLOMBO, July 14, 2018)