Monday, April 21, 2008

TANZANIA MINISTER QUITS AFTER BAE CONTRACT CLAIMS

By Russell Hotter
A senior minister in Tanzania's government has resigned after being allegedly linked to a controversial BAE Systems defence contract that is being investigated by Britain's Serious Fraud Office.
Andrew Chenge is understood to have stood down as the infrastructure minister on Sunday evening, following claims about him having a large sum of money in a bank account in Jersey.
The SFO is probing a 2002 contract under which BAE supplied Tanzania with a military radar system, a deal that was strongly criticised by aid agencies and politicians, including the then UK International Development Secretary Clare Short.
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Yesterday, lawyers for Mr Chenge said that he denied wrongdoing or having any involvement in deciding who got the contract. However, the Tanzanian media has reported extensively suggestions that the money could have been connected to the deal.
Last night it was still unclear why Mr Chenge, who was Tanzania's attorney general in 2002, had resigned.
The country's laws require ministers to disclose their wealth.
Mr Chenge's US-based lawyer, J Lewis Madorsky, said that his client did not deny having the offshore bank account, but added: "I've not had chance to speak to him [Mr Chenge] directly. But I know that he is shocked by the claims, but optimistic about the future. He had nothing to do with this contract."
Despite the SFO abandoning its high-profile investigation into BAE's Al Yamamah arms deal with Saudi Arabia, the fraud office has continued to probe several other overseas deals.
Poverty-stricken Tanzania bought a £28m military air traffic control system from BAE, when many experts said a far cheaper civil system would have done. At the time, Ms Short said the deal "stank".
BAE said it was "fully co-operating" with the SFO inquiry but would not comment further.
The SFO declined to comment.

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