Malawi has potentially missed out on an estimated $885 million (equivalent to around K900 billion) in a farm produce supply deal with South Sudan.
The agreement, which allowed Malawi to export maize, maize flour, groundnuts, and beans, was intended to provide a significant boost to the country’s economy.
Initially, the deal stipulated that Malawi would supply 180 metric tonnes (mt) of produce annually, yielding approximately K295 million for the nation each year. Facilitated by Ideal Group Limited, with Trinity Holdings of Sudan as the buyer, the five-year agreement was formally signed in 2021.
However, a recent revelation by Paul Nkhoma, Chairperson of the Trade, Industry, and Tourism Committee of Parliament, exposed that Malawi had only managed to export a mere 1,200mt of the agreed-upon produce.
Nkhoma criticized the Ministry of Agriculture for not taking a more active role in organizing and coordinating the export of the promised 180,000 metric tonnes, placing the responsibility on a smaller firm instead.
“There is no one you can point at as being responsible for organizing the export of the 180,000 metric tonnes. We feel that the Ministry of Agriculture should have been the first one to organize farmers, not leaving it to what the committee called a small firm to organize [the export of] 180,000 metric tonnes of cereals per year for five years,” said Nkhoma.
The deal also encountered financial setbacks, as Ideal Group faced difficulties in receiving payment from the Export Development Fund. Additionally, some of the exported produce, including maize flour, arrived in Sudan in a state of rot due to delays during transit.
In response to the revelations, Richard Chimwendo Banda, Leader of the House, acknowledged the weaknesses and missed opportunities highlighted by the report.
“The report highlights quite a number of issues, from institutional challenges [to others]. We are talking about an opportunity which was already signed, a deal which was already done, and there was expectation from Malawians that the deal would be done,” Chimwendo commended.
Chimwendo Banda commended the Forum for National Development for bringing the matter to the attention of Parliament. However, he urged the Parliament to take a more proactive stance in oversight and representation, rather than reacting after the fact.
Several lawmakers expressed disappointment over the failure to capitalize on this potentially lucrative deal, underscoring the need for better coordination and accountability in future trade agreements.
