Malawi fertiliser subsidy: Foreign companies with ‘exorbitant bids’ awarded contracts

Malawi government has awarded fertiliser subsidy supplying contracts mainly to foreign companies as opposed to locals and also preferred those who offered exorbitant bids.

Many Malawian owned companies have been left out. The indigenous companies employ millions of Malawians who are now facing a gloomy future.

According to a list of companies and their bids, foreign owned companies have dominated a list of successful bidders raising numerous questions.

Stocks fertiliser

In a questionable instance, one company called Mpungulira Trading Limited who also have experience in supplying fertlisers made an opening bid  of  $850m  to supply  Urea in Blantyre was left out opting to award to a bidder who opened with $897m.

And in another chilling instance several companies made fairly reasonable opening bids of $ 795m and the ministry opted to go for bids that hit as high as $900m.

President of the Indigenous Businesses Association of Malawi (Ibam) Mike Mlombwa expressed worry that some indigenous Malawian businesses participating and offering lower prices in the bid have been omitted.

Mlombwa said “Government should favour its indigenous businesses because they employ fellow Malawians. I do not think other countries favour foreigners.”

Accoridng to Ministry fo Agriculture sources, the contracts award was riddled with corruption and  “money exchanging hands in high offices”, saying what surprises many is that most of the companies left out have successfully supplied fertilizer in the last four years.

However, government claim that they based their choice on suppliers who had made what they described as affordable bids. And this is clearly in contrast with the document Nyasa Times sourced from the ministry.

Meanwhile, many Malawian owned companies face the fear of closure hence rendering millions of Malawians jobless.

The country will lose hundreds of billions of Malawi Kwacha that could have been saved by proper and fair awarding of the tenders, government sources said.

This year’s fertilizer subsidy program has been rocked by a lot of uncertainties, as the allocation of coupons to beneficiaries in most districts has gone down.  A case in question is a district in the northern part of the country, Rumphi where last farming season they had 25 thousand beneficiaries, but this year only 19 thousand people have been earmarked to receive coupons. This is in sharp contrast to statement made on political podiums that the number of beneficiaries would be increased.

People in rural areas who are the main beneficiaries of the fertliser subsidy program are anxiously waiting to see if the program will be as successful as it was in the past years.

The Fertilizer subsidy program was one of the highly successful programs under the late Bingu wa Mutharika administration which earned him numerous international accolades because it brought food security to rural households.

Some commentators claim that some deserving companies have been left out for political reasons basing on where they are based.

Companies who have been awarded the fertiliser contracts include; Agora Limited, Nyiombo Investments,  Farmers World Limited,Export Trading, Sealand Investments, Boss Distributors, ATC, Farmers World Limited, Mzati Investments, Simama General Dealers, Xelite Stripes, Yafuka Investments, Astro Chemicals, Lords Best Collection, Paramount Holdings and Mea Limited.

One company that employs many Malawians, Mulli Brothers Group of Companies, whose opening bids during the process were the lowest has not been given the contract.

Sources say government has deliberately chosen to watch huge sums of money going down the  drain, when there was an opportunity to save money in billions.

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