The past week has seen a media frenzy on the so called maize gate being sourced from Zambia by the Agriculture Development and Marketing Corporation (ADMARC.) The statements in the media have linked the maize purchase to my name as a stakeholder in supposed underhand dealings for myself interest (corruption)
I have decided to release this Press Statement to inform the General Public on what I know about the importation of maize from the Republic of Zambia by the Government of Malawi through the Agricultural Development and Marketing Corporation (ADMARC). At the outset, let me report that, my involvement was minimal as the main buyer of the maize was ADMARC and not the Ministry of Agriculture, Irrigation and Water Development. As most of you, may be aware, the Ministry of Agriculture, Irrigation and Water Development oversees the operations of some parastatals including ADMARC. While the Ministry focuses on providing policy direction and guidance, the parastatals manage day to day operational issues of their institutions and they are answerable to their Boards.
Regarding the maize procurement from Zambia, I was not directly involved. You may wish to note that, I was appointed as Minister of Agriculture, Irrigation and Water Development on 7th April, 2016. The appointment came at a time when Government was facing an unprecedented maize crisis after the Ministry estimated low production of almost all crops including our staple food maize. We had a maize deficit of at least a Million Metric tonnes and more households were going to be food insecure. The low production was due to poor rains that had affected the country because of the El Nino weather phenomenon that results in low rainfall. Unfortunately, the poor weather was experienced not just in Malawi but the whole Southern Africa and most African countries with only the Republic of Zambia that had declared a Maize surplus. It was therefore decided by Government that I lead a delegation to the Republic of Zambia to explore on the possibility of purchasing at least 300,000 MT of maize.
On 18th May, 2016, I led a three man delegation to the Republic of Zambia where I held a meeting with my counterpart, the Minister of Agriculture who gave us an approval to buy at least 100,000 MT of maize against our planned 300,000 MT. I came back to Malawi on 19thMay, 2016 and I left the team to contact the relevant suppliers. Upon return to Malawi, the team informed my office that the trip was futile as they had identified only one supplier whose price was exorbitant, at USD395/tonne. As such, no agreement was made.
ADMARC then undertook a follow up trip search for suppliers. It was during this visit that ADMARC reported that they met a number of suppliers including Kiloswe Commuter and Courier Ltd and ZCF. However, the credible agreement was reached with Zambia Co-operative Federation (ZCF) to supply 100,000 MT of maize. Thereafter, ADMARC held discussions with Ministry of Finance, Economic Planning and Development to pay ZCF through a Letter of Credit (USD 34.5 Million) from PTA Bank.
Subsequently, we learned through a Press Statement issued by the Zambian Government that they had banned maize exports and by that time ZCF had not yet started supplying the maize. Therefore, on 11th December, 2016, as a special Envoy of the President, Professor Arthur Peter Mutharika, I led a delegation to meet the President of Republic of Zambia on the export of maize to Malawi due to the fact that, a contract was already signed between the ZCF and ADMARC.
I arrived in the Republic of Zambia on the same day, met the President of the Republic of Zambia and thereafter attended a Press Briefing conducted by my counterpart, the Minister of Agriculture in Zambia during which she announced that the Government of Zambia had approved export of 100,000 MT of maize to Malawi. I came back from that trip on 12th December, 2016. This was on the understanding that this was a Government to Government arrangement.
I have also been informed by ADMARC, that no payment has been made to ZCF as the contract provided for a minimum of delivery of 10,000 MT before any demand is made to the Bank, to cash on the Letter of Credit. To date ZCF has supplied only 4,000 MT of maize.
Finally, I welcome the Commission of Enquiry that has been set up by His Excellency the President, Professor Arthur Peter Mutharika to investigate the matter at length.
Dr George T. Chaponda, MP
Minister of Agriculture, Irrigation and Water Development