Zambian UPP raises eyebrows over grain exports to Malawi transactions

A Zambian opposition leader has raised suspicion over transactions between Malawi’s ADMARC and a private firm involving Zambia maize exports to Malawi, alleging there was some racketeering by some top Zambian government officials.

Admarc CEO Foster Mulumbe: Bought maize from Kaloswe

President of the opposition UPP in Zambia, Saviour Chishimba, has challenged President Edgar Lungu “to intervene and correct the wrong impression that the transaction was between the Government of Zambia and Malawi”.

In a statement addressed to “fellow compatriots” that Nyasa Times has seen, Chishimba says he has asked the  Zambian Government to apologize to the nation and take action against officials who are corruptly behind the maize scandal under the pretext that the transaction is between the Government of the Republic of Zambia and Malawi when in fact it is not.

He observes Lusaka has not taken any corrective measures.

According to the UPP leader, a Zambian company called Kaloswe Commuter and Courier Ltd invested in the project to export maize to Malawi. After several trips to Malawi, Kaloswe found a local Malawian partner called ADMARC Ltd.

“On 31st May 2016, Kaloswe Commuter and Courier Ltd entered into a contract for the purchase of Zambian White Maize (Non-GMO) with the Zambia Co-operative Federation Ltd (ZCF). A Mr. James Emmanuel Chirwa in his capacity as Director General signed, under seal, for ZCF while a Mr. Isaac Kapambwe in his capacity as CEO signed, under seal, for Kaloswe. Under this agreement, ZCF agreed to reserve 100, 000 MT of maize at the selling price of US$215 per MT.

“On 17th June 2016, two agreements were executed. The first being between Kaloswe and ADMARC Ltd. Under this agreement, ADMARC was going to buy the maize from Kaloswe at US$345 per MT. All transportation of maize to Malawi and other logistical requirements were to be met by Kaloswe. This agreement was signed by a Mr. Foster C. Malumbe for ADMARC and a Mr. Isaac Kapambwe for Kaloswe.

“The second agreement was an addendum in which the parties mutually agreed that since ZCF was the ultimate source of maize it would be prudent to pay the whole amount of US$34.5 million into their (ZCF) account. ZCF would in turn deduct US$21.5 million due to it (ZCF) as duly agreed with Kaloswe on 31st May, 2016. The balance was going to be paid to Kaloswe whose legal duty it was to transport and handle all logistics in the whole transaction,” reads the statement.

According to the UPP leader, June 22, 2016 Kaloswe issued an instruction, in line with the agreement, to ADMARC to process and wire the US$34.5 million into the ZCF account number 0003203000439 at First Capital Bank.

He says that on July 13, 2016, PTA Bank wrote a letter of comfort to ZCF. In this letter referenced PTA/TF/ZCF/20160713,  jointly signed by a Mr. E Ali and Mr. G. Mudange, PTA Bank was confirming with ZCF that the Reserve Bank of Malawi has approached PTA to support the transaction involving the importation of 100, 000 MT of white maize through a programme that the bank extended to the Republic of Malawi. PTA Bank further confirmed, in the same letter, that there was an existing arrangement between the Agricultural Development and Marketing Cooperation (ADMARC) and PTA Bank over maize importation financing.

“On 26th July 2016 at 12:04:13 hours, US$34.5 million was wired into the account of ZCF at First Capital Bank via Standard Chartered Bank (Mauritius) Ltd.

“On 6th September 2016, Mr. Malumbe of ADMARC wrote an email to Kaloswe in which he was categorically re-affirming that all logistical costs on the Zambian size would be met by Kaloswe as per the agreement. The same email was copied to the First Capital Bank.

“On 6th September 2016, ZCF wrote a letter to Kaloswe in which they were confirming that logistical payments are to be made to Kaloswe on need-based. This letter was signed by a Mr. Frank Munthali the ZCF director of finance. The director of finance was replying to the request by Kaloswe to be paid an advance of US$350, 000 for logistics,” the statement says.

According to the statement, UPP is concerned with “the escalating business dealings between companies owned by the PF-MMD Ministers and senior civil servants who have become billionaires over the past few years”.

According to trade expert in Blantyre, the UPP may be concerned with the involvement of an intermediary (Kaloswe) in the transaction, arguing ZCF could easily have sold maize to ADMARC at US$34.5million and handled all logistics.

“ZCF sold to Kaloswe at US$21.5million, then Kaloswe sold to ADMARC at $34.5million and the difference is US$13million. Some people in the high echelons of power both in Malawi and in Zambia may have benefitted from this likely fraudulent transaction,” he said, preferring anonymity.

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CB
CB
7 years ago

The biggest humanitarian crises and they have nothing to do than still self-enrich themselves? Hopefully, ADMARC and government will be quizzed to finally answer some questions. Quick calculation: Kaloswe bought the maize at MK 7850. Let’s add another generous MK 1250 for transportation, so ADMARC could have bought the maize at MK 9000. Add the interest for the bank loan to PTA Bank and a small profit for ADMARC, ADMARC could be selling maize at MK 10,000 instead of MK 12,500. The taxpayer would not have to come up for the interest payment and ALL Malawians would be better off!!!!!

Kani Nsonthe
Kani Nsonthe
7 years ago

DPP WOEeeeeee!!! Paibe muthu aafe njaa ku Maawi kuno, shamvana? DPP WOeeeee!! Jikomo kwambii

Chiboli
Chiboli
7 years ago

Imfa ija inandidabwitsa ,lero naizi manje zizayamba kuwululika mwapaya munthu sembe wali na moyo

paul
paul
7 years ago

Alipo nso ku Central medical stores corruption amagula pa buy malawi campaign manhkwala opanda matender, mankhwala am bwera nchokera kunja koma labelo ama mata made in malawi, mankhwala za buy buy malawi campiagn nsa khale ndi phamvu ndi wadula kwambiri,

Fidel Castro
Fidel Castro
7 years ago

So that Zambian Chirwa I met here could be the one being mentioned in this article. Crook

MNDAMBALA BOY
MNDAMBALA BOY
7 years ago

Sheeeeeee!!!!!

Achikulile
Achikulile
7 years ago

Cashgate inathatu ku malawi!!!!

youna
youna
7 years ago

phewwww!!!!

Mphwache
Mphwache
7 years ago
Reply to  youna

Wina mpaka kufera pompo

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