Corruption in Coronavirus-Related Public Tenders in Georgia- Bellingcat

Corruption in Coronavirus-Related Public Tenders in Georgia- Bellingcat

access_time2020-08-04 12:01:17

An investigative journalism website Bellingcat writes about corruption in the state tenders in Georgia during  the coronavirus pandemic.

In response to a massive spread of the coronavirus globally, on the 21st of March Georgia joined the list of countries that declared a State of Emergency. Initially, lifting the state of emergency was planned on April 21, but the Georgian government decided to extend the restrictions for another month, until May 22. Georgia continues to defer their decision to re-open their borders to most countries.

Decades of research show quite clearly how emergency situations promote corruptive practices, with one analyst noting that “Opportunities to engage in corruption are particularly high in emergency contexts, where controls are weak, funding levels and media pressure are high” (Schultz & Søreide, 2006). With the coronavirus pandemic and the sudden need for new government services, instead of utilizing electronic tenders, so-called simplified state procurements take place in Georgia. This practice implies awarding non-competitive government contracts to companies, which may result in graft and breaches that include bribery, favoritism, influence peddling and self-serving purposes of the ruling party. 

According to Transparency International, the practice of awarding contracts to suppliers in an environment without fair competition places companies with political connections into privileged positions, often allowing them to triumph over their competitors that may actually be better suited to provide the contracted services. As a result, corruption increases the cost of public services, reduces the quality of work or services, and strengthens political influence of stakeholders.

Taking into account that 2020 is election year for Georgia, the electoral system has been changed to use proportional representation, and according to the the National Democratic Institute’s latest public opinion poll, the overall rating of opposition parties is higher than that of the ruling party Georgian Dream, it is especially urgent and vital that the government maximizes their financial and administrative resources in response to the coronavirus pandemic. 

Since the first responses to the COVID-19 and especially during the state of emergency, there has already been a wave of suspicious state procurements and non-competitive contracts between the Georgian government and number of companies, many of which have owners who are notable donors  to the ruling Georgian Dream party and linked to public officials.

This investigation focuses mainly on two areas of procurement that have arisen as a response to the coronavirus pandemic –purchases required for the Georgian healthcare sector and hotel expenses used as quarantine zones. In the first case, the major acquirer is the Ministry of Internally Displaced Persons from the Occupied Territories, Labor, Health and Social Affairs of Georgia (hereinafter, Ministry of Health), and in the second case the Georgian National Tourism Administration and the Department of Tourism and Resorts of the Autonomous Republic of Adjara.

Procurements in the healthcare sector

According to the latest research of the IDFI, a number simplified procurements for medical equipment and materials performed during the current emergency situation were signed with recently-established companies. It is worth noting that a number of these companies who received state procurements did not operate in the medical field, and many have senior staff who are notable donors to the ruling Georgian Dream party.

Taking this trend into view, we started to check the suppliers with whom the Ministry of Health reached contracts. Below, we detail a number of suspicious state procurement contracts related to the Georgian government’s response to the coronavirus pandemic, focusing on those that were given to newly-established companies, notable donors to the Georgian Dream party, and to companies without any readily-apparent experience in the area of the awarded contracts. In each of these, we show the original records of the contracts, along with basic information on the companies awarded the contract and their beneficial owners, when relevant. 

One of the suppliers is Weekend Ltd, which from 8 April 2020 to 10 June 2020 signed contracts with a number of different state departments and acquirers, overall amounting well over a million dollars. The most sizable procurement was from the Ministry of Health, amounting to $1,329,680 (USD). 

Bondo Goletiani, who contributed 25,000 GEL to the presidential campaign of Salome Zurabishvili, owns 100% of the shares of Weekend Ltd. Zurabishvili is the so-called independent candidate backed by the ruling Georgian Dream party.

Bondo Goletiani also owns shares in other businesses, such as Restaurateur Ltd. and Georgian Mobile Import Ltd., where his business partners and family members Chichiko Goletiani and Lekso Goletiani are listed. Chichiko and Lekso have also donated to Zurabishvili’s election campaign, totaling 42,996 GEL. These donations were made on the same day. Another business partner of Goletiani, Shalva Eristavi, has donated 60,000 GEL to the campaign. \

Another interesting purchase agreement was made with Ad Media Ltd. to supply 40,000 three-layered facemasks. 25% of the company’s shares are held by Sergo Galustyan, who has financially supported Georgian Dream and Salome Zurabishvili by donating 100,000 GEL during election campaigns. 


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