… As Spanish firm Indra Sistema fails to deliver
TINASHE MAKICHI
The Ministry of Transport and Infrastr ucture D e v e l o p m e n t has given the Civil Aviation Authority of Zimbabwe (CAAZ) a two week ultimatum to cancel the US$25m aerospace management system deal with Indra Sistema after the Spanish company failed to raise funding for the implementation of the country’s air-traffic management system.
The deal to implement an aerospace management system by Indra Sistema has always been under spotlight following revelations that it had gone through without board approval.
Transport Minister Biggie Matiza confirmed giving the directive to CAAZ to cancel the deal.
“I can confirm that I gave a directive to CAAZ and the intricate details with regards to the deal are with CAAZ,” Matiza said.
Former Minister of Transport and Infrastructure Development Joram Gumbo tabled the deal before Cabinet for approval despite reservations raised by the CAAZ board over the deal.
It is understood that the Spanish firm got approval from the Office of President and Cabinet circumventing the board on the basis they had funding.
The CAAZ board, which was dissolved last year and was led by prominent lawyer, Thembinkosi Magwaliba, had given a conditional approval to the Indra deal.
It is also highlighted that Indra security clearance from Ministry of Defence was never obtained considering that Defence is the one in charge of airspace security while Caaz only administers it.
But Matiza told Business Times in 2018 that his ministry had received recommendation from the board and “the approvals that Indra had received from all the regulatory authorities and after that we thought it was prudent to give green light to the deal because we need to move fast”.
“As it stands right now the Zimbabwe airspace is a black spot and we think this project is critical and must go ahead with immediate effect.
The country has also been losing revenue and it is critical that air traffic management is made a priority,” he said then.
According to documents seen by this publication, Indra got an approval for the deal on the basis that they had “a funding package” through a company called HOMT. But this failed to materialise.
“Remember these Spanish guys have been moving from bank to bank looking for funding.
Their award for the tender was based on the fact they proclaimed to have funding. They now have an indicative termsheet from Afreximbank but they require Export Credit Agency offshore cover for Zimbabwe risk,” said another source.
Information says the Spanish firm has managed to raise US$3m locally from FBC Bank for Air Traffic Control systems with a South African provider.
“It is not Indra that raised that money from FBC but it’s the previous board that raised that money after we had realised that the company has been failing to secure funds from international financial institutions,” said another former board member.
Indra Sistema, a company registered in Spain, expressed to the Ministry of Transport and to CAAZ interest and capabilities to provide the authority with Airspace Management Systems covering the Zimbabwean airspace.
The draft contract agreement was submitted, together with a legal opinion on the draft, to the board for the meeting on December 18, 2017.
The deal went on to be approved despite indications that the Minister of Transport that time was supposed to make a decision informed by recommendations from the board.
The awarding of the US$25m formerly valued at US$33m tender to the Spanish company has been mired in controversies.
There are concerns that the tender may have been inflated and that the awarding of the tender went against the Supreme Court judgment which cancelled the tender to Indra Sistems and ordered the contract to be remitted to the then State Procurement Board for a fresh tender instead.
In a proposal made by Indra to the Minister in October 2017 availed to Business Times, the company said, “Indra is confident to be among the best partner for the Ministry of Transport and Infrastructure Development and CAAZ to deploy such strategic programme, not only for the excellent financial conditions we are proposing, but also for our position in the airspace traffic management world”.
“Indra is the equipment manufacturer of all the equipment proposed and is committed to fully install and put in the operation the complete system in 18 months,” the company said.
