Advertisement
National

Government, Admarc differ on PTA bank’s Letter of Credit

Advertisement

Minister of Finance, Economic Planning and Development, Goodall Gondwe, has disclosed that grain marketer, the Agricultural Development and Marketing Corporation (Admarc), has to pay more than K1 billion to the Eastern and Southern African Development (PTA Bank) for the Letter of Credit the bank issued to Admarc.

Government obtained a loan of K26 billion from PTA Bank for the purchase of 100,000 metric tonnes of maize from Zambia, and the maize price was hiked from around K5, 000 to K12,500 per 50 kilogramme per bag to enable Admarc repay the loan.

Speaking to Malawi News on Wednesday, Gondwe said Admarc asked government, through his ministry, for help to pay the money.

Advertisement

“Admarc was given a Letter of Credit and they have a billion-plus to pay. They have asked us to help. When we have all the necessary details, we will help them through the Reserve Bank [of Malawi],” Gondwe said.

Admarc was caught in the suspicious purchase of maize from Zambia, popularly known as ‘Maizegate’.

Suspended Admarc Chief Executive Officer, Foster Mlumbe, once disclosed that Admarc did not source maize locally because PTA Bank could not pay a local supplier.

Advertisement

“PTA Bank would not pay Admarc. They would not issue LC [Letter of Credit] to a local supplier,” Mulumbe said at the time.

But Admarc Public Relations Officer, Agness Ndovi, said in response to a questionnaire that Admarc has no loan with PTA Bank.

“Government, through the Reserve Bank of Malawi, sourced a facility from PTA Bank through a Letter of Credit for the procurement of 100,000 metric tonnes of maize. Terms of this Letter of Credit was payment upon delivery of 100,000 metric tonnes of maize in Malawi. As you are already aware, the maize contract for procuring 100,000 metric tonnes was cancelled, after delivery of only 4,000 metric tonnes. Therefore, Admarc has no loan with PTA Bank since the Letter of Credit facility expired on December 31, 2016,” Ndovi said.

Facebook Notice for EU! You need to login to view and post FB Comments!
Advertisement
Show More
Advertisement

Related Articles

Back to top button
Close

Adblock Detected

Please consider supporting us by disabling your ad blocker