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Malawi government lied on Zambia maize

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Malawi government lied to Malawians by claiming that the 100,000 metric tonnes the country purchased from Zambia was an agreement between the two countries as documents in our possession reveal that the deal was signed with a private company.

Agricultural Development and Marketing Corporation (Admarc) Chief Executive Officer (CEO), Foster Mulumbe, on Wednesday categorically rubbished the reports and maintained that government has no dealings with the private company known as Kaloswe Commuter and Courier Ltd.

“We are buying maize from Zambia Cooperative Federation, those are our supplier. We have a contract with ZCF we paid them through LC and that’s the only transaction I know,” Mulumbe said.

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But an eight page sale contract that Mulumbe himself co-signed with CEO of Kaloswe Ltd, Issac Kapambwe, dated June 17, 2016 explicitly shows that Mulumbe is not being honest and raises questions as to why the Admarc CEO is defending the deal.

Another document dated September 6, 2016 from Zambia Cooperative Federation to CEO of Kaloswe Ltd signed by ZCF Finance Director Frank Munthali, with the subject “Advance Payment for Logistics- USD350,000.00” also shows that Kaloswe played a middle man’s role.

“This is with reference to the letter dated 30th August 2016, in which you requested us to pay you an advance payment of USD350,000.00 (Three Hundred and Fifty Thousand United States Dollars) for transportation of grain and associated logistics on the Admarc contract to supply 100,000 MT of grain.

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“To this end, we wish to advise you that payments on this facility are on need bases only. Consequently, we may only be able to consider your request once the export documents are finalised.”

Apparently, had Admarc purchased the maize directly from ZCF, it could have saved billions of dollars.

The documents show that Kaloswe Ltd bought the maize from ZCF at $215 per metric tonne before reselling it to Admarc at $345 per metric tonne.

Government obtained a loan from the Eastern and Southern African Development Bank (PTA Bank) of K26 billion to purchase the 100,000 metric tonnes of maize from Zambia, and the maize price was hiked from around K5,000 to K12,500 per 50kg bag to enable Admarc repay the loan.

Ironically, Minister of Agriculture, George Chaponda, is on record as having said that he is happy with the K12,500 per 50 kg maize price arguing that the private traders where people are now opting to buy maize from will exhaust their stock and in the end, people will have nowhere to buy but from Admarc.

“That’s exactly what we wanted. That is competition. That is positive development for me. Admarc has gone to the bank and borrowed K26 billion and it will have to pay back with interest. If Admarc factored other logistics into the price, it would have gone up to K312 per kg,” Chaponda said last month.

In an exclusive interview with opposition leader of United Progressive Party (UPP) in Zambia Saviour Chishimba who has threatened to drag some Malawian officials to court together with some ministers in his country over the scam, said according to the documents he also possesses, Admarc confirmed the contractual relationship with Kaloswe and not ZFC.

“It’s this circumvention and sudden change of events which make the whole deal to stink of corruption. It’s carelessness on the part of public officers which can cause costly litigation and at the end of the day taxpayers suffer the burden.

“Zambia and Malawi share a common history and the people in our two countries share common struggles of unemployment, poverty among other challenges. We shall now commence the court action which we shall seek the sacking of the entire ZCF management,” Chishimba said.

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