News

Fronting in construction real, says CEEC

STEVEN MVULA, Lusaka
THE use of fronts in the construction industry is rife and this has resulted in Zambia losing huge sums of money through externalisation, Citizens Economic Empowerment Commission (CEEC) director-general Likando Mukumbuta has said.
Mr Mukumbuta said CEEC, in conjunction with other agencies, has embarked on an exercise to review legislation that allows foreigners to partner with locals in owning companies.
“Fronting is an offence punishable under the CEEC Act but it has continued to manifest itself and it is now a challenge. Some foreigners get their guard or house boy and use them as owners of the companies to get preferential treatment,” Mr Mukumbuta said.
He was speaking yesterday when he appeared before Parliamentary Committee on Communications, Transport, Works and Supply.
Mr Mukumbuta said Government should review the 20 percent subcontracting policy by increasing the threshold with a view to enhancing the participation of local contractors.
“The problem is inherent in the law. And this law which makes a foreigner access preferential treatment is abused,” he said.
Mr Mukumbuta said CEEC has in the past one year been working with the Patents and Companies Registration Agency and other agencies to reform the law and suggest the necessary changes to Parliament.
“We want to exclude foreigners from preferential treatment. We want to eliminate the loopholes for fronting by simplifying the law. We want to somersault Zambians into owning the economy,” he said.
Chairperson for the committee Vitalis Mooya equally observed that the country is losing huge sums of money through externalisation by the foreign companies that use Zambians as fronts.
“Yesterday we were told that there are over 4,600 registered constructing companies and only four percent is foreign, yet it is these same foreign companies that get over 90 percent of contracts,” he said.
Meanwhile, University of Zambia (UNZA) School of Law dean Fredrick Mudenda has called for the enactment of a law to ban torture.
Dr Mudenda yesterday told a Jack Mwiimbu led parliamentary committee on legal affairs, governance, human rights, gender matters and child affairs that there is empirical evidence of torture in Zambia and that the vice must be outlawed.
“There is no specific law against torture and yet every year the state of human rights shows that the Zambia Police Service is a culprit,” he said.
Dr Mudenda said torture is systematically practiced in Zambia.


Facebook Feed

Ad1