Secretary to the Treasury Cliff Chiunda says funds realized from the sale of tractors earmarked for the Green Belt Initiative are safe since they have been deposited into the government consolidated Account Number One.
Tax payers are repaying the $50 million (about K37 billion) the Malawi Government borrowed from India in 2011 to mechanise agriculture but ended up benefitting selected individuals, it has emerged.
Chiunda said government is paying back the loan at an annual interest of two percent. He said the loan will be repaid over 25 years effective 2017.Appearing before Parliament’s Public Accounts Committee (PAC) inquiry into the controversial tractors deal, Secretary to the Treasury, said Malawians will be told how the funds for the tractors have been recouped and no penny will be lost at all.
He said ;”All those who acquired the tractors will pay for them come December. We will put measures in place to make sure that all the records are intact for scrutiny. The loan that was used to acquire the tractors being a concession mean that the interests will be minimal.
“When repaying the loans we use the funds from Account Number One hence nobody should panic.”
PAC vice-chairperson Noah Chimpeni has since deemed the loan as a burden on Malawians.
“During the week, we have been meeting various officials in government as regards the disposal of the equipment. It is sad that the disposal wasn’t beneficial to Malawians as just a few individuals benefitted.
“After the inquiry, we will come back with our position as a committee, but to say the truth, the disposal was not well thought of and a flop,” he said.
The loan was meant to mechanise agriculture and included purchase of 177 tractors and 144 maize shellers, 90 tipping trailers and 48 seed-cum-fertiliser drilling machines.
The tractors were meant for distribution to agriculture development divisions (ADDs) to enable smallholder farmers graduate to mechanisation by hiring the equipment.
Out of the total implements procured, 69 tractors, 15 trailers, 70 maize shellers and 17 seed-cum-fertiliser machines were offered for sale in August 2014.
During the inquiry, it emerged that the tractors were sold at an average price of K5.6 million against a potential price of K10 million because authorities used the exchange rate used during the purchase instead of the prevailing one at the time of the sale.Follow and Subscribe Nyasa TV :