…Move will save US$200m
Government has cancelled contracts of maize importers that were
bleeding Treasury by charging prices above those obtaining on the international market amid revelations that some unscrupulous companies were lining their pockets with taxpayers’ funds.
The cancellation of the contracts will save Treasury of around US$200m,
insiders told Business Times yesterday.
It is understood those that were awarded contracts were charging
US$390 per tonne whereas maize is currently selling at US$250 to US$280
The current move comes also at a time when concerns have been raised on the awarding of government contracts amid fears that some contractors were paying bribes to land the lucrative government contracts.
A well-placed source at GMB told Business Times that all contracts that
have been proved to have bordered on extortion were cancelled.
Various private players that were awarded the contracts are alleged to have
been taking advantage of the crippling grain shortage by charging exorbitant prices at a time when foreign currency demand is also high on the part of government on the back of the biting Covid-19 pandemic.
“Contracts for the purchase of maize which were exorbitant were cancelled.
Suppliers were selling maize at an average of US$390 per tonne when prices are down to about US$250 to US$280.
The cancelled maize contracts will save government over US$200m,” the source said.
GMB general manager Roki Mutenha did not respond to questions send by
the Business Times at the time of going to print.
Government contracts of late have been so lucrative attracting fly by night
businesspeople and suppliers who have manipulated the system by allegedly greasing the palms of senior government officials.
This has seen those given contracts supplying sub-standard products. For
instance, in the Personal Protective Equipment purchase for Covid-19 ,
Government has been short-changed by some suppliers who have in
most instances inflated prices taking advantage of the current crisis.
Last year, government was forced to deny allegations that maize
imports from Tanzania were coming at double the price prevailing on the
Maize imports in Zimbabwe came at a time when the country is
in need of maize imports following the drought experienced in the
2018/19 agriculture season.
Foreign currency starved Zimbabwe is spending US$42m on genetically modified and ordinary maize imports in an effort to supplement food for the country which continues to experience very low agriculture productivity levels due to the El Nino-induced drought.
Zimbabwe needs 1.8m tonnes of cereals annually but is likely
going to get a harvest of around 800,000 tonnes of maize this season
necessitating the need for imports to feed the starving 8m people.
According to data from the US Department of Agriculture,
Zimbabwe’s need for maize imports was mainly caused by a poor
domestic harvest which had fallen by 53% year-on-year in 2018/19
production season to 800,000 tonnes.
The country’s command agriculture scheme that was introduced three years ago to improve food security has failed to turn the country into the
breadbasket of the region, which has seen Zimbabwe importing
maize grain from Tanzania, Zambia among other countries in the region
including South Africa.