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More rot in Zambia maize deal

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Contrary to claims by Agricultural Development and Marketing Corporation (Admarc) Chief Executive Officer, Foster Mulumbe, that government terminated a contract with a Zambian private company for the purchase of maize in June 2016, documents in our possession clearly show that Admarc continued to transact business with the company.

Mulumbe, on Friday, held a press briefing in Blantyre to dispute our investigative stories where he claimed that a contract with Kaloswe Commuter and Courier Ltd was terminated in June 2016 and that Admarc signed a new contract with Zambia Cooperative Federation (ZCF) to purchase the 100,000 metric tonnes of maize.

But pursuant to the agreement between Kaloswe and Admarc, the private company wrote a letter of instruction to Admarc on June 22 2016 for the purposes of wiring $35.5 million into the account of ZCF.

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Documents we possess show that on July 26, 2016, PTA Bank wired the funds on behalf of Admarc.

Reads the letter signed by Kaloswe Company Secretary, Titus Nyirongo: “We, Kaloswe Courier Limited, hereby authorise you, Admarc Limited, to make a letter of credit to Zambia Cooperative Federation Limited whose account details are stated below.”

And Mulumbe wrote an email to Kaloswe confirming that all logistical costs on the Zambian side would be met by the private company.

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In another email communication on October 7, 2016, the then Admarc director of administration and company secretary, George Bakuwa, confirmed a planned meeting among ZCF, Kaloswe and an official of Admarc.

Bakuwa died while on duty in Zambia.

“ZCF paid Admarc a visit. Looking at the issues involved, it was agreed that Kaloswe ought to form part and parcel of the discussions, hence the planned meeting in Lusaka and your invitation,” Bakuwa wrote.

He was responding to a query by Kaloswe’s Nyirongo who wrote: “We have received an invitation letter from ZCF saying one of your officials is coming through ZCF for a meeting. May you kindly appraise us on this one.”

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 Eastern and Southern African Development (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.

President Peter Mutharika ordered the hike, arguing that it was meant to enable Admarc to service the PTA Bank loan.

Ironically, Minister of Agriculture, George Chaponda, 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.

As attempts to cover up the rot continue, the Zambian Government has said the deal is not between ZCF and Admarc but between ZCF and a Blantyre-based Malawian company. We have deliberately withheld the identity of this Malawian company as we continue to remove layer after layer of this high-level syndicate

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