Rwanda has formally requested the Ugandan authorities to arrest and extradite Chinese businessman Mr. Chen Chao, aged 38, who is wanted in Kigali on charges related to forgery and tax evasion. Mr. Chao is currently residing in Uganda under the protection of a senior police officer. The request was made following an international arrest warrant issued on September 22 by Aimable Havugiyaremye, the head of Rwanda’s National Prosecution Authority, and submitted to Kampala’s authorities.
The charges against Mr. Chao stem from a contract worth over $12 million awarded by King Faisal Hospital Limited to Power China International for constructing an outpatient department section in Kigali, Rwanda. Power China International subsequently assigned the contract to its subsidiary, Power China Guizhou Engineering, which, in turn, subcontracted it to Mr. Chao’s Entec Technology Company Limited, a registered entity in Kenya. The project was left incomplete, leading to Power China Guizhou Engineering stepping in to salvage it and attempting to cash in a warranty bond worth $610,322. However, the bond’s legitimacy came into question as Sidian Bank of Kenya disowned it.
Additionally, investigations by the Rwanda Revenue Authority uncovered an unpaid tax bill amounting to Rwf 21,840,259 (approximately UGX 67 million), leading to the indictment of Mr. Chao on April 26, 2023. If convicted, he faces a prison sentence ranging from five to seven years and a fine.
Uganda and Rwanda signed an extradition agreement in 2020 as part of their efforts to improve relations, which had led to Kigali closing its border. Mr. Chao, known for his close ties to government officials, was also involved in an $85 million contract for civil works at the international specialized hospital in Lubowa, Uganda. This project has faced controversy due to the lack of transparency in the use of taxpayers’ funds and delays in construction.
In March 2023, a whistle-blower prompted an investigation into a $2.9 million payment made by Power China to M/s Legrandlac Consulting and Engineering Company Limited, a company in which Mr. Chao held powers of attorney. The investigation is ongoing, but no charges have been filed in connection with the transaction.
Furthermore, Mr. Chao is embroiled in a protracted dispute over control of Entec Electrical Equipment Company, which he co-founded with other Chinese business partners. The fight has extended to Kenya, where the Ethics and Anti-Corruption Commission (EACC) in Nairobi has been asked to investigate a payment related to concrete poles supplied by Entec Electrical Equipment. The dispute has also led to concerns about potential money laundering, although the EACC has not provided further details on the ongoing investigation.
