Twist, turns in maize saga

Consumers Association of Malawi (Cama) findings in the maize procurement saga that has hit Agricultural Development and Marketing Corporation (Admarc) indicate that no funds have been remitted to any of the two Zambian suppliers.

According to Cama, the two Zambian suppliers, privately-owned Kaloswe Commuter and Courier Limited and Zambia Cooperative Federation (ZCF) also failed to supply Malawi with maize as stipulated in their contracts of June 17 2016 and ZCF only managed to supply 1 530.503 metric tonnes (MT).

Presenting the findings to journalists in Blantyre yesterday, Cama executive director John Kapito said his organisation, going through by page, discussing with both Admarc and various players and following the whole trail of events, discovered that ZCF has not received any money and they are requesting Admarc through Reserve Bank of Malawi (RBM) that they should be paid for the little they supplied to Malawi.

Their contracts stipulated that each was going to supply up to 100 000 MT of white maize to Admarc at a contract price of $345 (about K258 750) per MT. The price was fixed for the entire contract duration.

Cama has since faulted the State produce trader and the Ministry of Agriculture, stating that the two continue to provide the public misleading and contradicting information as regards to the procurement of the Zambian maize.

“But the latest information, as late as 10th January 2017, is that Admarc and RBM have failed to pay the ZCF because it  failed to meet some of the requirements of the Letter of Credit (LC) that stated that it had to supply the 100 000 metric tonnes in tranches of 10 000 metric tonnes. As such, they are unable to be paid and, therefore, their invoice has been rejected. That is the first payment that could have gone to Zambia so far.

“There is also mention of Kaloswe Commuter and Courier Limited. We found out that the company really had a contract with Admarc but that contract was terminated by both parties (Admarc and Kaloswe).

“Also, in the process of our investigations, we discovered that Kaloswe signed a contract with ZCF to be supplying maize to Malawi because they could not establish a letter of credit and currently, Kaloswe could not and has not supplied any maize to Malawi. So far, no penny, under the PTA Bank has gone to Zambia or paid to the two presumed suppliers,” said Kapito.

He indicated that Cama’s investigations also looked at issues involving Admarc’s local purchase of maize after believing that the K12 500 per 50 kg bag maize price had been exaggerated, claiming  the maize had been bought from Zambia at an exorbitant price.

Said Kapito: “But we discovered that the maize that was bought locally is the one selling at K12 500 and that Admarc bought that maize [about 106 000 MT] at K231.60 per kg average price across the country from many individual traders. We also agreed that the price of K12 500 is not the final [one] because the price should have been about K15 700 according to what Admarc paid for the maize, as such, the K250 is justifiable though it is barely being afforded by the consumer.

Cama has since recommended that both ZCF and Kaloswe contracts be terminated as they both failed to meet requirements of their contractual obligations and that there was  a need to investigate why Minister of Agriculture George Chaponda and Admarc board chairperson James Masumbu informed the nation that they were not involved in the local and international procurement process of maize when there is evidence that all transactions Admarc made were approved by the board and when there is evidence that the Ministry of Agriculture at one point instructed Admarc to buy maize from some traders.

Commenting on Cama’s findings in a telephone interview yesterday, Masumbu, while stating that he has not yet seen the Cama report on the investigations, said perhaps Cama is right to say that the board lied when it said that it was bypassed because initially the board never alleged that it was bypassed but it was quoted out of context in the media.

“At no point did the board allege that it was bypassed because our understanding as a board is that when we gave approval for the purchase of maize, management was then at liberty to buy maize and they indeed informed us that they were buying maize from outside Malawi and within Malawi, to which we said yes, do that.

“What we were expecting at the end is that the management would come up with a report to say, pursuant to the approval you gave us to purchase maize from Malawi and other countries, this is the maize that we bought from Malawi and this is what we bought from outside the country, but we had not received a full detailed report of where, how much, from who and which contracts were cancelled, among others, until we left office.”

On the key finding that there is no money that was released to pay any of the Zambian supplier and that the only maize that came into the country is the 1 530 MT, Masumbu said that is information that Malawians will get from the commission of inquiry that was set up by President Peter Mutharika, not from Admarc.

Meanwhile, civil society organisations (CSOs) have called for the findings of the three probes into the Zambia maize procurement saga to be submitted to Parliament for action to avoid past experiences in which inquiries yielded no results.

Several members of CSOs led by the Human Rights Consultative Committee (HRCC) made a submission to the joint committee of Public Accounts Committee and Parliamentary Committee on Agriculture which has been instituted to probe allegations of irregularities at Admarc and Ministry of Agriculture in the procurement of maize from Zambia.

The committee comprises 10 members, five from each of the two committees and will be co-chaired by the vice-chairperson of Public Accounts Committee, Kamlepo Kalua, and chairperson of the Agriculture Committee, Joseph Chidanti Malunga.

The objectives of the inquiry are to establish whether procurement procedures were flouted and if they were, to bring to book all institutions and individuals involved.

The Parliament inquiry is due to establish the extent Admarc, Ministry of Agriculture and Office of the Director of Public Procurement (ODPP) were involved and what decisions were made during the procurement process. n