Economic Planning Minister Goodall Gondwe, appointed recently by President Banda to help fix a sputtering economy, has sought to justify his decision in the 2004/2005 fertilizer subsidy deal where it is alleged that he meddled in the award of a contract to a Saudi Arabian company.
Gondwe was found by the country’s Anti-Corruption Bureau to have acted corruptly in a fertiliser deal [2005/05 farming season] that cost Malawi $6.8 million. He is, however, yet to be prosecuted.
He told state run MBC television through Malawi wa Lero program that he has no regrets for his decision, saying he had done “the right thing for Malawi”.
“It is true I have been under ACB probe for the past seven years over the awarding of contract to a Saudi Arabian company to supply fertilizer for the subsidy programme. But as you are aware that year it was our first time as a new government and as a country to start implementing the farm input subsidy programme.
“As such, I and the late president Bingu wa Mutharika had to make very swift decisions to save the programme as it were heading for a disaster. To avoid such a disastrous scenario I had to bypass government’s bureaucratic rules just to make sure that the programme sees the light of day,” he said.
“So I have no regrets over it and I did what I felt necessary for my country and the people of Malawi,” said a visibly confident Gondwe.
Gondwe, a former IMF vice president for Africa region, presided over years of economic growth which averaged 7 percent, reduced inflation to single digits and oversaw debt cancelation under the HIPC initiative before late President Bingu wa Mutharika dropped him from cabinet over graft allegations.
Meanwhile, Gondwe disclosed through the program hosted by Wadza Otomani that the graft busting body has since informed him about its decision to discontinue with the probe.
He said despite not being formally charged, he has always maintained his innocence on the matter.
“Problem with our media is that whenever there is news that you are being probed, it is seen as trial on its own but it is part of ACB’s responsibility to probe people and if they find that there are indeed irregularities then you are charged with corruption. I’m happy that the case is now water under the bridge,” added Gondwe.
When contacted ACB senior publicist Egritta Ndala refused to comment on the issue through telephone interview saying it is the bureau’s policy to respond to media questions through a written questionnaire.
According to a leaked report by ACB which has not been made public, Gondwe, probably the most popular former finance in the post democracy era, ignored advice from government’s technical advisory committee and went ahead to award the contract Pioneer Chemicals a Saudi firm, despite being told that the company was small and no capacity to supply over 70 000 metric tonnes of fertilizer.
The report further says the minister together with other two senior officials namely, Dr Milton Kutengule then secretary to treasury and Nebert Nyirenda who was director of Public Enterprises Reform and Monitoring Unit (PERMU), coerced Smallholder Farmers Fertilizer Revolving Fund of Malawi (SFFRFM) management to procure 35,000 metric tons of Urea fertilizer and 35,000 mt of 23:21+4s against the country’s set public procurement laws, regulations and procedures.
By then there was a recommendation in place for the government to buy the commodity from South Africa and it still remains misty as to why Gondwe insisted on awarding the contract to the Asian company and not the South African firm.
Interestingly, a few months later Gondwe was proved right as his preferred choice, Pioneer Chemicals, only managed to supply half of the consignment and this led to Malawi government losing over $6.8 million.
Sensing a potential jeopardy of the programme, Malawi government then was forced to source the remainder within the country, according to ACB report accessed by Nyasa Times.
The Accountant General therefore proceeded to award contracts to five local companies namely, Farmers World were awarded the contract to supply 20 000 tonnes, Export Trading supplied 5, 000 tonnes, Rab Processors 3 000 tonnes, Nyiombo Investments Limited 6,000 tonnes and Agrimark got 1,000 tonnes to supply.
In the report however, the ACB failed to prove beyond any doubt that the former finance minister got kickbacks from the Saudi company. But still, his decision cost the Malawi government billions of Kwachas, according to the report.Follow and Subscribe Nyasa TV :