Malawi renegotiates $145m arms deal with Paramount: ‘We are better all eating’

Malawi government set to renegotiate a deal worth $145 million (about K58 billion)  with Paramount Group, Africa’s largest private defence and aerospace firm, which signed deals with the Malawian government for agriculture, fuel and military contracts through a network of investment firms.

Finance Minister Gondwe: Deal not cancelled but renegotiated

Finance Minister Gondwe: Deal not cancelled but renegotiated

Finance Minister Goodall Gondwe said earlier it had cancelled the deal with Paramount Group, which was engaged, under the previous Joyce Banda administration, to supply military equipment to Malawi Defence Force because it was “illegal and expensive.”

But now government has revisited the issue and instead of cancelling, they will renegotiate, Attorney General Kelekeni Kaphale confirmed.

Malawi government is reported to have convened a meeting involving officials from Paramount Group and Gondwe, Governor of the Reserve Bank Charles Chuka and Attorney General Kaphale after noting legal pitfalls in the deal.

Gondwe told Paramount Group during the meeting that the whole transaction was “illegal and unsustainable” and that the minister of finance was bypassed.

Under that agreement, Paramount Group was to supply wide-ranging equipment to establishments under the Malawi Defence Force. The total bill amounted to $145 million at the time, which under the current rate is about K58 billion.

Paramount also signed a deal with Malawi to provide seven interceptor boats to patrol Lake Malawi.

It is also linked to the sale of Malawi presidential jet, the Dassault Falcon 900EX  which was bought by Bohnox Enterprises, a firm registered in the British Virgin Islands, and sent to South Africa, where it is loaned to VIPs by the jet company Fortune Air.

“ We will just renegotiate some of the contracts,” said Kaphale as quoted in the local press.

When Malawi cancelled the deal, Paramount Group released a statement, describing the termination of the contracts as untrue.

Under the contracts, Malawi was supposed to pay the supplier $5 million (K2 billion) quarterly.

Paramount Group is run by the South African brothers Ivor and Eric Ichikowitz and specialises in manufacturing armoured vehicles and unmanned aerial vehicles. It previously brokered a deal for the Malawian government to equip its peacekeeping troops in the Democratic Republic of Congo.

Trans Africa Capital, a venture capital firm run by Eric Ichikowitz, also signed agriculture and fuel contracts with Malawi’s government.

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vilimmwera
Guest

why going to the same dealer you claim transacted an illegal deal? eee kusowa kolowera, re negotiating ? serious? so gondwe knows best to negotiate, kkkkkkkkk

Tukombo
Guest

So why did you arrest Odillo????

Baba wa boy
Guest

I know a bit of basic law.

There is offer
There is acceptance
There is Consideration

But if there is a counter offer, it is not the same contract, it is a different one.

Chindele
Guest

Thieves, how can u say the deal was illegal and then renegotiate the same illegal deal.You have been palm oiled.Can the anticorruption bureau if at all it does exist do its job on this issue.No question of not having moved.

Kanonono
Guest

It is only in Malawi where people can dare ask how much their government spends in military equipment. Shame on Nyasa Times!

johnM
Guest

In many countries with a proper and a real military, How much Government spends is public knowledge. Why should it be any different with Malawi?

JJB
Guest

Only as a percentage of GDP. How many people do you think calculate how much that is?

Think Tank
Guest

Look at them. Rushing with “illegals” everywhere,then it was not “illegal” after all! We want to re-negotiate ! How can you renegotiate on an illegal transaction without cancellation? The truth is you have yet to reveal the way funds from jet sales were used and you have found there is nothing to be agitated about. You rushed alot with accusations,only to recind them.

Shyman Shaizo
Guest

Buy fighter jets not timifuti ndi tizipolopolo…Nkhondo masiku ano idasintha.

Kamkhwezule Kakang'ono
Guest
Kamkhwezule Kakang'ono

To avoid future bad deals such bilateral agreements should be open to public scrutiny including parliament. Otherwise what guarantee is there that this corrupt DPP government is not negotiating a deal to also oil their palms?

thembi
Guest

The evil works of a an evil woman.

wafika
Guest

We knew that what you were doing was bush politics from learned men but not wanting to admit that what their fellow politician was doing was saving the countries money and the people of this poor country. Mwagwa nayo. who is fooling who. The poor Malawian will have to cough more now. damn me

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