Chinese negotiator in Enemalta deal is revealed as man behind secretive Macbridge

A Chinese executive who helped negotiate the Shanghai Electric investment in Enemalta is behind Macbridge, a company Konrad Mizzi and Keith Schembri planned to do business with.

An international investigation by Reuters and Times of Malta found that Chen Cheng, a senior executive for Accenture, a global consultancy firm, used relatives to set up two firms in Hong Kong.

The first of the companies set up by the Chen family, known as Macbridge, planned to pay up to $2 million to Panama firms controlled by Mizzi and Schembri. It was listed as a target client alongside 17 Black, which was revealed to be owned by Yorgen Fenech.

The second Chen company was called Dow’s Media Company, and the investigation revealed how it received €1 million from 17 Black.

Fenech stands accused of masterminding the murder of journalist Daphne Caruana Galizia. He has pleaded not guilty.

In July last year, MaltaToday had reported that Fenech told police at the time of his arrest in November 2019 that Macbridge was acting as another conduit for moneys from government-financed projects.

He had told police he knew the reason it was set up, as well as the ownership of the company but gave no further details.

Police investigators believed Macbridge was an acronym that stands for ‘Malta And China Bridge’.

According to international legal requests seen by Reuters, Maltese law enforcement officials suspect that Macbridge and Dow’s Media were part of an elaborate scheme, involving some participants in the China-Malta deals, to make payments to politicians in Malta and siphon off profits for themselves.

Fenech’s lawyers declined to comment about any links between their client and Chen.

According to Caruana Galizia’s son, Matthew, his mother had known of 17 Black and Macbridge in April 2016 and was working on a tip that they were used to funnel money to politicians. Caruana Galizia was murdered in October 2017, before she could complete her work.

Chen, Shanghai Electric Power and Montenegro

Chen was involved in the negotiations that saw the Chinese State energy company, Shanghai Electric Power buy a stake in Enemalta in 2014.

He was also involved in the Montenegro wind farm investment by Enemalta that saw 17 Black make a hefty profit, as revealed by a journalistic investigation last year.

Shortly after, the new investigation reveals that 17 Black made three payments to Dow’s Media, totalling €1 million.

The revelation of a Chinese connection potentially adds a new international dimension to a scandal that has rocked Malta’s government and last year led to the resignation of prime minister Joseph Muscat.

In 2016, Caruana Galizia identified Chen’s key role in the Malta-China energy transactions on her blog.

Caruana Galizia reported that Chen created a company in the British Virgin Islands in 2014, for an unknown purpose. In the same year, Chen played a central role in negotiations and due diligence for Shanghai Electric Power to invest €380 million in buying a stake in Enemalta.

Now, reporters at Reuters, the Times of Malta, the Organized Crime and Corruption Reporting Project and the Süddeutsche Zeitung, have discovered that Chen’s family set up two further companies in Hong Kong, both with business links to Malta.

Chen and Shanghai Electric Power didn’t comment. Accenture said in a statement it is taking the matter very seriously and “carefully reviewing these allegations as they relate to one of our people. We adhere to the highest ethical standards in every market in which we operate and have zero tolerance for any deviation from those standards.” Enemalta declined to answer questions about Chen.

The office of the spokesperson of China’s foreign ministry said, “China’s exchanges and cooperation with other countries are all open and transparent.”

Schembri did not comment when contacted through his lawyer, while Mizzi has continued to insist he has no knowledge of Macbridge and his only connection to Chen was through his official capacity. Mizzi was energy minister at the time of the Chinese investment in Enemalta.

Opposition leader reacts

In reaction to the report, Bernard Grech said that this is confirmation of the "huge and institutionalised corruption" that took place under Joseph Muscat.

"Robert Abela has political responsibiliy. He should imemediately begin a process so that the country frees itself from any ties with Electrogas," he said.

READ ALSO: Malta needs to rid itself of Electrogas - Bernard Grech