The Ministry of Energy has sued three companies it accuses of pocketing a total of K1.4 billion upfront for Malawi Rural Electrification Programme (Marep) Phase 9 materials, but failed to supply, Weekend Nation has learnt.
The f i rms—Af rica Green Economy, Kumakoka Trading Company and Loui Holdings Group (PTV) Limited—allegedly received advance payments for their contracts in the 2022/23 financial year.
Information Weekend Nation has gathered through court documents and interviews reveal Africa Green Economy Limited got K698 050
991.00; Kumakoka Trading Company pocketed K523 538 243.57 while Loui Holdings Group is yet to supply cables worth K144 674 756.91. The documents did not show the amounts of the full contracts.
The ministry, through the Attorney General’s chambers, has since commenced legal action to recover the funds from the three firms, together with interest, damages and other costs arising from the alleged contract breaches.
According to the court documents filed at High Court Lilongwe District Registry, the ministry commenced the litigations in August 2025.
From Africa Green Economy, the ministry is demanding a refund of K698 050 991.00 plus interest at the rate of 10 percent above the prevailing commercial lending rate calculated from the date of disbursement of the funds until full and final settlement.
The ministry is also claiming an award of general damages for breach of contract, including compensation for the loss suffered as a result of the company’s non-performance.
Further, the ministry wants an award of special damages incurred as a direct consequence of the firm’s breach of contract.
The special damages include escalated and additional project costs arising from inflationary pressures and the devaluation of the Malawi kwacha, loss of anticipated social and economic benefits resulting from the delayed implementation of Marep Phase 9 and damages for inconvenience and disruption occasioned by the firm’s conduct, including administrative burdens and delays in project planning and execution.
Finally, government is claiming an award of the costs of the action including court fees, disbursements and legal representation as well as collection costs incurred in the recovery of the sums due and payable under the contract.
Africa Green Economy has since acknowledged the ministry’s claims, but is seeking an out-of-court settlement through arbitration.
Through lawyers Silungwe Law Consultants, the company has since proposed settlement terms to repay the outstanding advance payment, which includes paying the principal sum in 30 equal monthly installments.
The firm has requested that interests and all other consequential losses be excluded as it also made losses on the transaction, but the matter is still under discussion.
According to their letter to the Attorney General, the lawyers said the company used part of the advance payment collected from the project to pay the supplier to start manufacturing the materials.
“However, due to scarcity of forex, our client could not fulfill the other payments to the supplier in time. As such, the supplier cancelled the contract and forfeited the deposit.
“This greatly af fected our client hence its failure to fulfill its contractual obligations with the Ministry of Energy,” the lawyers wrote to the Attorney General on September 25, 2025.
Silungwe Law Consultants managing partner Donvan Silungwe said he was occupied with other court matters and requested more time before responding.
However, Weekend Nation’s subsequent follow-ups proved unsuccessful as he neither responded to our questionnaire nor answered the phone calls.
Kumakoka Trading Company lawyer Zolomphi Nkowani confirmed in an interview on Tuesday that the Attorney General had made the claim which has now been referred for arbitration.
“It awaits appointment of an arbitrator and thereafter the process will start,” he said in a written interview.
Loui Holdings Group managing director Louis Ngalande, while expressing ignorance about the court case, confirmed failing to “fully supply” the required project materials.
He said: “I am not aware that the matter is in court because I was never served with any summons or court documents. It is also not true that I received the money but failed to supply any project material.
“The truth about that contract is that I supplied up to 80 percent of the material. The K144 million being referred to is for the 20 percent which
I didn’t supply.”
Ngalande attributed his firm’s failure to supply the remaining 20 percent to the two back-to-back major devaluations that hit the country between 2022 and 2023.
“After that tragedy, I engaged the relevant authorities to consider paying me the final disbursement to use and order the remaining material from the manufacturer in China, but nothing worked out,” he explained.
In an interview last week, Ministry of Justice and Constitutional Affairs spokesperson Frank Namangale confirmed the AG was handling the three court cases.
He, however, declined to divulge further details on the cases’ progress saying “relevant authorities will respond to your questionnaire at an appropriate time.”
Marep is a government programme in the Ministry of Energy jointly funded with the World Bank, but implemented by Electricity Supply Corporation of Malawi (Escom) throughout the country to increase access to electricity, especially in rural areas where about only five percent of the population is connected to the national grid.
The programme, which was introduced in 1980, is implemented in phases and is currently in Phase 9.
The target for Marep Phase 9 was to connect about 500 sites covering nearly 21 000 households. However, phase 9 has been facing the challenge of escalated costs which jumped from K40 billion to K70 billion due to devaluation of the kwacha and an increase in minimum wage.
Government set an overall target of at least 30 percent electrification rate in rural and peri-urban areas by 2030, the year Malawi is expected to achieve universal access to affordable, reliable and modern energy under Sustainable Development Goal 7 (SDG).
On May 23, 2026 Minister of Energy Jean Mathanga raised concerns during a high-level engagement at Escom headquarters in Blantyre that some companies had received advance payments for Marep materials, but failed to deliver.
The minister stressed that inefficiency and procurement failures must be decisively addressed to ensure Malawians benefit from reliable electricity.
