China Eximbank provides $73.7 million preferential buyer’s credit for Safe City Project

In 2015, Huawei Technologies Co., Ltd. submitted an unsolicited bid to the Government of Mauritius to implement a Safe City Project (SCP). Then, on April 1, 2018, China Eximbank and Mauritius Telecom Ltd — a minority state-owned telecommunications company in Mauritius — signed a preferential buyer’s credit (PBC) agreement worth $73,687,000 for the Safe City Project. The PBC carries a 2% interest rate, a 20-year maturity, and a 7-year grace period. The Government of Mauritius issued a sovereign guarantee for the loan. The borrower was expected to use the proceeds of the loan to partially finance the cost of commercial contract with Huawei Technologies Co., Ltd., which was signed in December 2017. The loan’s outstanding amount was $22,349,375 on June 30, 2018, $58,963,735 on December 31, 2019, $62,730,781 on December 31, 2020, and $65,050,841 on June 30, 2021. The Safe City Project involved the installation a CCTV Smart Camera Surveillance System, a Multimedia Radio Trunking System, a Central Watch and Management System, an Integrated Emergency Response Management System, and an Intelligent Command System to enable the Police Department to obtain better intelligence with a view to optimizing responses. The original project scope also included the provision and installation of 4,000 ‘smart cameras’ (intelligent surveillance cameras) in major public areas — specifically, along main roads and motorways, pedestrian walkways and traffic centers — 500 trunking smart handsets, 500 trunking vehicle radios, 4,500 smartphones, and 150 fixed desktop terminals to provide an ‘umbrella’ for public safety in Mauritius. The project’s stated objective was to enhance the security and safety of the public. Police stations in Cote d’Or, St Pierre, La Gaulette, Poudre d’Or, St Pierre and Petit Gabriel in Rodrigues were expected beneficiaries of the equipment and technology. Huawei Technologies Co., Ltd. was the contractor responsible for project implementation. On August 19, 2019, the Government of Mauritius officially launched the SCP’s centralize command and control center. However, 18 months after the project’s scheduled completion date (June 2019), the SCP was still not fully operational. As of December 30, 2020, only 130 of the 300 Intelligent Traffic Surveillance (ITS) cameras had been installed in 69 of the 75 sites; 346 vehicular mounted radios had been installed in police vehicles, while 4 had not yet been installed; and one static radio terminal had not yet been installed in a police station. As of January 28, 2021, only one of the seven sub-command centers had been completed and commissioned, a Service Level Agreement (SLA) for the hosting of servers had not been finalized, and ‘smart’ cameras were only installed at 756 of the 2,000 Intelligent Video Surveillance (IVS) sites. Delays in the implementation of the SCP were attributed to: a decision to install steel poles for the IVS cameras instead of CEB poles as originally planned during implementation phase; installation issues related to the servers at the Government Online Centre; an issue related to the ‘End of Supply’ of the communication equipment; and the serial numbers of cameras not matching those specified in the technical specifications. The project also become a source of local scrutiny and controversy due to concerns about transparency and data privacy/security. The purpose of the SCP was to provide tools and technologies to the Police Service to help it monitor and manage its resources so as to enhance its responsiveness and efficiency through real time information. However, the Mauritius Police Service later told the country’s National Audit Office (NAO) that it could not share key pieces of information about the project because of the nature of two contracts that its signed with Mauritius Telecom (MT) — a partially state-owned enterprise — in December 2017 to implement the SCP through an operating lease model. The Mauritius Police Service informed the NAO that it could not furnish either of these contracts due to the inclusion of mutual non-disclosure clauses in the contracts. Section 110 (2) of the Constitution of the Republic of Mauritius specifies that ‘the public accounts of Mauritius and of all courts of law and all authorities and officers of the Government shall be audited and reported on by the Director of Audit and for that purpose the Director of Audit or any person authorised by him in that behalf shall have access to all books, records, reports and other documents relating to those accounts’. According to the NAO, ‘[the] clauses in [the] contracts [between MT and the Mauritius Police Service] deprives the Director of Audit of access to public records for audit purposes’ and ‘the constitutionality of [the clauses] is questionable.’ The Police Service informed NAO that the advice of the Attorney-General’s Office was being sought on the matter. Apart this these government accountability issue, concerns haven arisen about who stores and controls the data collected through the SCP. The Government of Mauritius has maintained that the Mauritius Police Force will operate the cameras and have custody of data collected. However, during a court case, officers from the Mauritius Police Force testified that the data was in fact held by MT. MT was quick to release a public statement saying that the data was stored at the Government Online Centre – a public body under the aegis of the ICT ministry.

Additional details

1. This project is also known as the Safe Country Project and the Mauritius Telecom Safe City Project of the Mauritius Police Force. The Chinese project title is 智能城市项目 or 毛里求斯晋非智慧城市项目. 2. In the database of Chinese loan commitments that it released in July 2020, SAIS-CARI did not include this loan. 3. On December 19, 2017, the Police Service signed two contracts on an operating lease model with Mauritius Telecom (MT) for the implementation of the SCP: (a) Lease of Intelligent Video Surveillance (IVS) and Intelligent Traffic Surveillance (ITS) cameras, and Centralised Command and Control Centre for a total cost of $410 million (VAT Exclusive) for a 20-year period. On October 29, 2018, an addendum to the contract was signed for the provision of steel poles for fixing of cameras for some $9.3 million (VAT Exclusive). The variation was due to non-availability of appropriate poles. (b) Lease of Radio Communications System for some US$ 46 million (VAT Exclusive) for a 20-year period. Under the first contract, the Government of Mauritius was required to make a non-refundable advance payment of $13 million (VAT Exclusive), annual fees of $16.6 million (VAT Exclusive) during the first seven years and $21.6 million (VAT Exclusive) for the remaining 13 years. Additional annual amounts of $714,000 (VAT Exclusive) are payable during the first 12 years and $95,000 (VAT Exclusive) during the remaining period for the provision of steel poles. An annual amount of some $2.3 million (VAT Exclusive) is also payable under the second contract on a quarterly basis. The total contract amount was thus $465.3 million, exclusive of VAT. The lease agreements were not made available to NAO Officers; access was provided to only certain extracts of the agreements.

Number of official sources

21

Number of total sources

29