World Bank protests K14bn ICT contract

The World Bank has protested the Malawi Government’s decision to cancel and re-launch a K14 billion procurement process of  a telecommunication connectivity contract funded by the bank’s loan.

The contract under the Digital Malawi Programme Phase 1 was awarded to two local private companies last month.

However, according to the World Bank, Ministry of Information and Digitisation requested the contract to be cancelled and that the procurement process be re-launched to have it awarded to the Electricity Supply Corporation of Malawi (Escom).

In an interview yesterday, Minister of Information and Digitisation Gospel Kazako said they have engaged the Ministry of Finance and Economic Affairs on the World Bank concerns.

He said: “We would like to have the loan reviewed.”

In a letter dated July 8 2022 addressed to the minister, World Bank country manager for Malawi, Hugh Riddell, warned that the cancellation and re-launch of the procurement process would lead the bank to declare misprocurement and invoke relevant legal remedies within the financial agreement.

The bank said there was no complaint lodged during the bidding process and that it reviewed the bid evaluation report and issued a “No Objection” on March 29 2022 to award the $13.66 million (about K14 billion) contract to Bengol Net Ltd and Inq Digital.

Reads the letter in part: “However, given the World Bank procurement regulations which restrict the contracting of the State-owned enterprises, Escom would not be eligible for such a contract award.”

The bank has since recommended awarding the contract to the successful bidders without further delay.

But Kazako, in a written response to The Nation questionnaire yesterday, said the Minister of Finance has directed Secretary to Treasury to engage the World Bank on how best the matter can be resolved.

He said government requested the cancellation and re-launch to align the loans to the “Tonse Government strategy and to benefit Malawians”.

 “We had a similar loan in the past from the World Bank, which in our technical assessment didn’t yield the results that were expected. This is why we would like to have the loan reviewed. We can’t make the same mistake twice,” said Kazako.