It is our obligation to properly supervise all investment projects to ensure that the poor and vulnerable are protected in our work. In this case, we did not.
The World Bank has cancelled a $265 million infrastructure project in Uganda after a review found evidence of misconduct by its contractor, including sexual harassment of female workers and road workers having sexual relations with underage girls.
The project, which included the construction of about 225 km (140 miles) of road in western Uganda, began in 2009 with the bank giving an initial backing of $190 million. An additional $75 million was approved in 2011.
In a statement issued on Monday, the bank said it had received a request in September to investigate a range of allegations made by the affected communities. The statement did not identify the company involved by name.
"The multiple failures we've seen in this project...are unacceptable," World Bank President Jim Yong Kim said in the statement. "It is our obligation to properly supervise all investment projects to ensure that the poor and vulnerable are protected in our work. In this case, we did not."
He said both the bank, the Ugandan government and the contractor were responsible for the failures.
The World Bank is one of the major sources of relatively cheap credit for the East African country, providing crucial funding for projects in transportation, education and other sectors.
The statement said the bank had decided to scrap the project even though an investigation of the charges was still ongoing "because of the serious nature of the allegations."