By Deogratias Mmana:
The Ministry of Finance which is struggling to raise domestic resources will have to raise about K1 billion of its own to complete works for an already funded project at the Ministry of Tourism.
This is the case because the ministry did not submit a request letter to the African Development Bank Group (AfDB) for an extension of a project.
The Ministry of Tourism has been implementing a project called Promotion of Investments and Cooperatives in the Tourism Sector (Picts) to the tune of about K12 billion since 2018 to June this year.
The failure to submit the request means the ministry will lose $929,114.68 (K930 million).
We have seen the letter dated March 27, 2023 which the project team prepared for Principal Secretary (PS) Chauncy Simwaka to sign and send to the bank but it does not have the signature and was not dispatched.
The letter with reference number DoT/2/34 is addressed to Evelyne Change of the AfDB and is titled ‘Request for zero cost extension of project implementation period’.
“As you are aware, the Picts project is due for closure on 30th June, 2023. Overall, project implementation has been satisfactory with most of the project initiatives concluded and some in their final stages.
“However, some activities still require more time due to lengthy procurement processes and delays by contractors,” reads the letter which bears Simwaka’s name.
The letter further reads:
“With the current project closure date of 30th June, 2023, the project will not be able to finalise the above stated activities. As a consequence, the remaining project funds amounting to $929,114.68 will not be fully utilised.
“In this regard, I write to request a zero-cost extension of the implementation period for the Picts project from 30th June, 2023to 31st October, 2023.”
The remaining tasks according to the letter include tourism law review, supply of kitchen equipment and furniture for Mzuzu MIT [Malawi Institute of Tourism] Lodge, Lake Malawi National Park and Kasungu National Park, review and approval and signing contracts and delivery of the items.
The letter says construction works at Mzuzu MIT Lodge, currently at 85 percent progress, were affected by stop orders issued by the National Construction Industry Council and Mzuzu City Council and were due for completion in May 2023.
“However, handover of the building will not be done until equipment and furniture has been installed,” the letter reads.
The letter which Simwaka was supposed to sign and send to AfDB was preceded by a loose minute prepared by the Picts coordinator and addressed to Simwaka as PS for the ministry asking him to sign and submit the request to the AfDB.
“Therefore, AfDB has advised that the project be extended for an additional four month implementation period to allow proper finalization of these activities.
“The request for the extension has to be submitted to the bank by 31st March 2023, without which the project will not be able to finalise the contracts, consequently losing the remaining project funds.
“As such, I write to submit to you a letter to AfDB requesting that the project closure be extended from 3oth June 2023 to 31st October 2023. This is submitted for your review, approval and signature, Sir,” reads the loose minute dated March 27, 2023 and signed by Picts project coordinator Herbert Chihana.
In an interview Friday Chihana said the letter was not sent to AfDB and as a result, the Ministry of Finance will have to source funds to implement the remaining tasks at Mzuzu MIT lodge, lest it becomes another white elephant.
“We tried to reason with management in the ministry to send the letter to the AfDB but they did not take our plea. The bank had written to us for the request for the extension but there was no response from us,” Chihana said.
He said the consequence for not submitting the letter is that the onus to find resources to finish the remaining tasks rests on the government.
“Government is now facing the consequences for just failing to approve the letter because money for finishing the work is not there. Over one billion kwacha will be needed to finish the remaining tasks,” he said.
Chihana expressed displeasure at tourism ministry management for putting spanners into the project.
In an interview Friday, Simwaka justified his decision for not submitting the request to the AfDB saying the project had finished.
“The information you have is not true. Who gave you that information? Completion time for the project came and all the resources were used,” Simwaka said.
While admitting that there are some activities to be done, Simwaka insisted that the project had come to an end.
“Almost full payment was done. Every project has a lifespan,” he said.
Tourism is one the three pillars President Lazarus Chakwera’s administration has been touting for development.
The others are agriculture and mining.
