East Timor PM accused of corruption
Updated
The father of East Timorese independence, Xanana Gusmao, is at the centre of a new corruption scandal.
Prime Minister Gusmao signed-off on a multi-million dollar government contract to a company in which his daughter was a major shareholder.
An investigation by Radio Australia has found Prima Food last year won a government contract to supply rice worth $US3.5 million dollars.
Speakers: Deputy leader of the opposition Fretilin party, Arsenio Bano; East Timor's Finance Minister Emilia Pires; Statement from Melissa Stephens, East Timor government spokeswoman; East Timor's Minister of Economic Development, Joao Goncalves; East Timor's President, Jose Ramos Horta
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STEVE HOLLAND: Zenilda Gusmao, the Prime Minister's daughter, is listed as a Prima Food shareholder in East Timor's 2008 business registry.
The country's procurement law bans 'agents of the administration', politicians and bureaucrats, from awarding government contracts to businesses associated with close family members.
Deputy leader of the opposition Fretilin party, Arsenio Bano alleges the Prime Minister's authorisation of a goverment tender for a company linked to his daughter is a blatant example of corruption in the Prime Minister's Office.
He has called for the Prime Minister's resignation and says there's no excuse for his actions.
ARSENIO BANO: It is indicating very strongly that there's collusion, nepotism and corruption. How can a prime minister of Timor Leste sign a multi-million dollar contract with a company that his daughter is also [a] shareholder?
HOLLAND: Xanana Gusmao was unavailable for comment. The Prime Minister's daughter, Zenilda Gusmao, also declined to comment.
However, a spokeswoman for the government confirmed to Radio Australia that Zenilda Gusmao was a shareholder of Prima Food.
In a statement, Melissa Stephens said:
GOVERNMENT STATEMENT: "The Government has always been transparent on these contracts and went to enormous lengths to establish a fair and equitable environment for the private sector."
HOLLAND: But, Arsenio Bano says he has approached the government on a regular basis since December, seeking information about companies linked to relatives of ministers, but the government refused to supply the information.
Radio Australia has also confirmed that the wife of another senior minister has profited from government tenders.
Kathleen Goncalves, wife of East Timor's Minister of Economic Development, Joao Goncalves, is connected to at least three companies that have been awarded multi-million dollar government contracts approved by the Prime Minister.
Those three companies connected to Kathleen Goncalves are United Foods Lda, Belun Feto Lda (both listed under Kathleen Goncalves' Chinese name, Fon Ha Tchong) and Tres Amigos.
Those companies were last year collectively awarded more than $US11 million worth of government contracts.
Kathleen Goncalves declined an invitation to be interviewed.
But Melissa Stephens defended Mrs Goncalves' involvement.
GOVERNMENT STATEMENT: "She (Kathleen Goncalves) has been in business in Timor since 1999 importing rice and was an authorised vendor for previous governments, including the Fretilin Government and the Gusmao Government."
HOLLAND: Kathleen Goncalves' husband, Minister Joao Goncalves, said he did not know the names of his wife's companies or which ones had secured multi-million dollar government contracts.
JOAO GONCALVES: I didn't even know that she had won that tender at that time. You know, I knew only after...the time after that. I didn't even know that she had put in that tender as well.
HOLLAND: The companies connected to Kathleen Goncalves, and Prima Food, are listed on a government list of 16 businesses that last year secured government rice contracts worth $US56 million.
But East Timor's Finance Minister, Emilia Pires, was also unclear about the details of companies awarded multi million dollar rice contracts.
EMILIA PIRES: Yeah well, I'm not familiar with all the names but there were a lot that came in. If I'm not mistaken there were between 12 and 16 companies.
HOLLAND: Ms Pires believes it is not her role to know the details of contracts.
PIRES: But I don't even know who are the members of these companies. Like, why should I bother about that - I'm a Minister? Like, people have rights to be whatever they are. Like I said already, by the time it gets to the Prime Minister it's been cleared by all the processes.
HOLLAND: The funds for the rice contracts came from the country's Economic Stabilisation Fund and was distributed as part of food security measures aimed at ensuring the population had sufficient rice supplies.
East Timor's President, Jose Ramos Horta, has distanced himself from the allegations.
JOSE RAMOS HORTA: In our political system, the president does not have executive authority. I cannot everyday interfere in the running of the country. If that's what I want to do, I might as well run for prime minister. That is the responsibility of the prime minister.
HOLLAND: Xanana Gusmao played a key role in his country's 25-year struggle for independence from Indonesia. He became East Timor's first President in 2002. He was elected Prime Minister in 2007.
Additional reporting: Stephanie March, Girish Sawlani, Alison Caldwell and Jeff Waters.
Xanana Gusmao, Zenilda Gusmao and Kathleen Goncalves declined invitations to discuss their involvement in the approval of millions of dollars of contracts issued to relatives of ministers.
