Guatemala to Claim $122 million from Odebrecht

Following the Brazilian construction company's abandonment of the road work contract that had been awarded, the government intends to make a claim on the advance payment and performance bails which amounts to $122 million.

Tuesday, February 20, 2018

The contract consisting of the extension of 140 kilometers of the CA-2 West highway was awarded to the construction company Odebrecht in 2012, however, the company abandoned the work after performing work on only 43 kilometers.  

Since then, the Guatemalan authorities have tried, without success, to liquidate the contract. In respect to this, Prensalibre.com reports that " ...On December 6, 2017 the administrative term that the Project Receiving and Liquidating Commission of the General Directorate of Roads had set for the settlement of the contract expired, however, by means of a "repair of works" act they extended the timeframe until the January 19, and Odebrecht did still did not provide the pending documents. "

See "Contract with Odebrecht Ended and New Tender Launched" and "Guatemala: Plan to Finish Road Works".

The article adds that " ... the Commission is working on an amendment so that the receipt of the bonds, the only thing that is lacking for the liquidation, is active and without a set deadline."

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More on this topic

Road Expansion Remains on Paper

October 2018

The Guatemalan government will liquidate the works contract to extend 100 km of the CA2 East highway, which connects the department of Escuintla and the border with El Salvador.

The Ministry of Communications announced that this month they plan to liquidate the contract with Sigma Constructores, which had as objective to expand from two to four lanes the stretch of road that goes from Escuintla and ends at the border Ciudad Pedro de Alvarado, Jutiapa Department.

End of Odebrecht´s Story?

March 2018

After multiple attempts to liquidate the contract and collect the bonds for the road works that were awarded to the Brazilian construction company, the Guatemalan government has finally received the money and will be able to tender the works again.

Representatives from the executive board announced that they have already received two bonds corresponding to the road works for 140 kilometers of the CA-2 highway, meaning that the path to bidding for new contracts is practically open.

Progress in Process to Resume Road Works

February 2018

Although they have not finished liquidating the contracts with the Brazilian company Odebrecht, Guatemalan authorities say that the bids to conclude the works are going ahead.

The contracts that the Ministry of Communications intends to terminate early are those corresponding to the extension of 97 kilometers of the CA-2 West highway.

Contract with Odebrecht Ended and New Tender Launched

October 2017

The government of Guatemala has agreed with the Brazilian construction company to bring forward the termination of contract for extending the CA-2 Occidente highway and will launch a tender for three contracts to complete the remaining 97-kilometer stretch.

The contract was awarded to construction company Odebrecht in 2012, and after the corruption cases the that it was involved in came to light, the government of Guatemala decided to negotiate the early termination of the contract. The head of the Ministry of Communications, Infrastructure and Housing (CIV), Aldo García, told Elperiodico.com.gt that "... because of the reservation there has been over the investigation of this case, it can only be anticipated that the agreement reached with the company is under legal review, a company which in 2012 obtained the contract for the extension of the CA-2 Occidente highway for US $399 million."

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