Govt to acquire 60% shares in Salima Sugar Company
Minister of Finance and Economic Affairs Sosten Gwengwe says government plans to review the shareholding arrangement it struck with the private sector in Salima Sugar Company.
He said this yesterday in Parliament in Lilongwe while responding to a question from Machinga East legislator Esther Jolobala (United Democratic Front) who asked the minister to update the House on the company’s shareholding arrangement.
Over the years, members of Parliament have been pushing for a review of the company’s shareholding agreement, arguing that Malawians were duped. The lawmakers are against the government holding of 40 percent shares while the private investor Aum Sugar Company Limited holds 60 percent.
Gwengwe said: “The partnership is under review and I can tell you that the Attorney General has given opinion on how to move forward because we still stand by our position that the deal was not in the best interest of Malawians.
“Our proposition is that the government should get more shares. We will have the Registrar General certify the new shareholding arrangement.”
In an interview, he maintained that there is a new shareholding arrangement that will be shared to the public once certified by the Registrar General.
Gwengwe said when the government becomes the major shareholder, it will engage other players to acquire shares in the company.
Jolobala commended government for reviewing the shareholding agreement.
“We used taxpayers’s money from Malawians to start the company. In a shareholding agreement, the one who has invested more and initiated the project is supposed to have a bigger share, but the private investor got more,” she said.
Jolobola called on government to ensure transparency in the new arrangement.
In the initial arrangement, government was supposed to hold 60 percent shares, but got 60 percent and government remained with 40 percent.
Government established the company to expand exports, create jobs and empower farmers.
Meanwhile, Parliament has passed the Shire Valley Transformation Programme-Phase II Loan Authorisation Bill that seeks to enable government to borrow K140 billion from the International Development Association of the World Bank.
The loan will be paid in 32 years with an interest rate of 0.75 percent
Mwanza Central legislator Nicholas Dausi (Democratic Progressive Party-DPP) and Chitipa South parliamentarian Werani Chilenga (DPP) called on government to revive other irrigation schemes in the country.
