The government has stopped its grain trader, the Agricultural Development and Marketing Corporation (Admarc), from borrowing K403 billion externally to finance its revamping programme.
Instead, according to Admarc Board Chairperson Alexander Kusamba Dzonzi, the cash-strapped firm has been given green the light to solicit part of the funds domestically.
“We followed the law and we have been directed that we should not get the loans from these sources,” Kusamba Dzonzi told journalists at a press briefing on Saturday.
Among other ventures, Admarc wants to have a textile company, surgical wool manufacturing company, fertiliser manufacturing company, grain and milling company and rice company milling as part its turnaround plans.
Apart from local banks which include NBS Bank and Eco Bank, Admarc was also in talks with Northern Capital from Zimbabwe, Trooper Group of South Africa and BT Commodities, again from South Africa, among possible financiers.
Kusamba Dzonzi said after screening foreign middlemen and the banks, the government advised against the move.
He said, alternatively, a pool would be set where other local commercial banks would come in as funders of the initiative.
He said Admarc failed to clinch multi-billion kwacha deals outside the country when the agreements collapsed.
“In our discussions with BT Commodities of South Africa, we agreed that its sister company in Kenya was to buy 1.2 million tonnes of maize from Admarc.
“We had an agreement with Trooper that we should be supplying 400 tonnes of soya every month for 12 months to Zimbabwe and we had an agreement with Northman that we should be supplying various types of crops of up to half million tonnes. Since we have been advised otherwise, we have lost all that,” he said
He said with funding from the government, Admarc intends to buy about 1.1 million tonnes of maize in phases.