Strange contract procedure in kidney dialysis privatization

The President isn't answering questions --- but is tweeting attack messages, some of them particularly quixotic. The Minister of the Presidency is unavailable and the Security Minister is on the defensive, crying for a new Italian government that seems indisposed to clarify matters and save his position and reputation. And in the midst of all that, the cabinet approved a $126.3 million kidney dialysis outsourcing contract with a recently formed "consortium" of three companies, two of them within the Dominican Republic's IBT conglomerate, the third the original winning bidder at a much lower price.

Late in 2010 Promociones Medicas SA (Promed) won a competitive bidding process to set up, equip and run 13 kidney dialysis clinics to treat 1,500 patients for the Social Security Fund health care system. The price tag was $98 million.

But Comptroller General Gioconda Torres de Bianchini --- theoretically a legislative employee with independent powers but actually the in-house accountant for Ricardo Martinelli before coming to her present post --- refused to sign the contract, effectively killing the deal. She said that it was overpriced.

The thing went out for bids again, this time with the specifications that there would be 1,656 patients to be served at 17 centers, and with a government base price of $105.3 million. The companies that had lost out to Promed in the previous bidding found the government's number too low and dropped out of the bidding process. Meanwhile, a consortium that didn't legally exist yet, with Promed as the junior partner to the IBT Group's International Business and Trade LLC and Constructor Consulting and Engineering (Panama), was most unusually allowed to participate in the contest. As the only bidder, this consortium "won" with a bid of $126.3 million. Three months after the bidding, the consortium was legally registered to do business in Panama.

Now isn't THAT strange? And the IBT Group --- isn't one of their subsidiaries Tarjetas Laser Latinoamerica SA? You know, the guys who in 2010 got another no-bid contract from the Martinelli administration, wherein they were paid $575,874 to make 600,000 blank Panamanian passport books, and made them with a made-in-the-DR version of Panama's national coat of arms, substituting a mace where there ought to be a shovel. So the penalty for that gaffe was --- an even bigger, even more contrived effective no-bid contract, this time with the health of Panamanians rather than one of the national symbols on the line.

IBT also has some major hospital construction contracts with the Panamanian government, by way of its Carimex subsidiary. Carimex's paper president is one Gustavo Franchella, who is also the paper head of Agafia SA, the Valter Lavitola company that was set up to skim 10 percent from the Panamanian government's arms purchases from the Italian state-controlled company Finmeccanica and its subsidiaries. The working assumption among Italian prosecutors on the case is that Agafia was not to give Lavitola a juicy cut --- although he surely would have been paid for his role --- but to divert money from large, overpriced contracts into a slush fund to bribe Panamanian public officials and give some Italian politicians a cut as well.

La Prensa, based on Dominican media reports, alleged a social relationship between the owner of the IBT group, José Ramón Brea, and the president's two sons Ricardo and Luis Martinelli. One of these, Ricardo Martinelli Linares, denied it. The other has so far maintained his silence.

It looks awful, and the Martinelistas have responded not with any coherent explanation of the contracts that they have awarded, but with a fresh round of attacks on the press and opposition parties. The president vowed in a Twitter message not to change his cabinet under media pressure. Meanwhile Minister of Labor Alma Cortés went on television to claim that she has obtained emails between PRD secretary general Mitchell Doens and imprisoned Colombian money launderer and Martinelli campaign contributor David Murcia Guzmán --- which is an odd sort of claim, given that Murcia is and has for some time been a US federal prisoner, and such inmates are not allowed access to the Internet.

One more contracting scandal? No big deal for these folks --- but they don't want anyone writing about it. If anybody does write about it, they want him or her to know that they aren't paying attention. Except when the president gets on Twitter.