Inspection of $5.2 Million Bagrami Industrial Park

Today, SIGAR released an inspection report on the $5.2 million USAID-funded design and construction of Bagrami Industrial Park.

The inspection notes:

— USAID awarded a $10 million contract to Technologists, Inc. (TI), a U.S. company, for the development of three industrial parks in Afghanistan. After 11 modifications, the contract’s value increased to $21.1 million.

— As a result of some missing documents, including the record of final payment, USAID could not tell us when Bagrami Industrial Park was completed or when the park was transferred to the Afghanistan Investment Support Agency (AISA).

— We found that the contractor, TI, did not build the industrial park according to contract requirements. As a result, the park lacks adequate water and sewer collection and treatment systems.

— During our inspection, we found that TI had only partially completed Bagrami Industrial Park’s water supply system. USAID officials could not explain to us why the water supply system had not been completed.

— Due to the absence of a completed water supply system, the park did not have its planned on-site water source. Instead, the Ministry of Finance purchased water from a local textile factory. The factory’s water wells are located almost 2 miles from the industrial park.

— USAID contracting officials could not tell us why TI did not build the required sanitary sewer collection and treatment system, or why a civil engineer was not consulted to review the final drawings or technical specifications.

— TI’s system design did not provide for treating the water run-off, and we found that the park’s factories were releasing water with industrial contaminants into the park’s streets.

— Due to the inadequately constructed and designed storm drainage system, there is a potential health risk to the park’s workers and patrons, as well as to the local residents in the surrounding neighborhood.

— It appears that USAID did not provide adequate oversight or thoroughly inspect the park before acceptance because it paid TI for these two systems.

— The park flourished in 2011 and 2012, employing 2,200 people or almost three-fourths of its 3,000 employee goal. 27 out of 32 possible business operated in the park. However, at the time of our July 2015 site inspection, the number of employees had decreased to about 700 across the 27 out of 32 possible businesses. During our follow-up site inspection in June 2016, nearly a year later, we noted that the 27 businesses were still operating in the park, but the number of Afghans employed had decreased to about 500 workers.


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