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The World Bank has expressed worry over government concerns on the Lilongwe- Salima water project.
According to its latest Malawi Economic Monitor, the World Bank says the planned Lilongwe –Salima water project raises concerns from the modality of its implementation, especially related to lack of transparency around the borrowing of resources for government equity.
The water project also poses challenges for public finance management reforms and also elevates fiscal risks that could potentially reduce gains from ongoing fiscal consolidation process.
The bank further notes that the recent revelations related to the procurement of defense equipment from a company linked to a business man facing numerous corruption charges highlight the relevance of the comprehensive roll out and real time utilization of the integrated Financial Management Information System(IFMIS) across all Ministries, Departments and Agencies(MDAs) and ensuring that transparent procedures for procurement processes are followed.
The government spokesperson, information minister Moses Kunkuyu was not available for comment.
Currently. The government plans to top up the K105 billion loan borrowed from NBS Bank and National Bank of Malawi for the Salima –Lilongwe water project by an additional k70 billion, as it seeks to boost the equity contribution in the project.
This is according to NBS Bank and National Bank of Malawi(lake Malawi water supply project) Loan (authorization) Amendment Bill , 2024 which is expected to tabled during the current sitting of parliament .
The Bill seeks to amend the NBS Bank and National Bank Loan Act (No.20 of 2023). To include CDH Investment Bank Limited, as one of the lenders of funds for the Lake Malawi Water Project.
The bill once proved would bring government’s equity contribution to k175.1 billion at the current exchange rate, representing 30 percent of the total project.
Government awarded the contract to Khato Civils and South Zambezi joint venture.
Briefing reporters in Lilongwe on the issue of government continued dealings with UK businessman Zunneth Sattar, Kunkuyu and Defense Minister Harry Mkandawire said that the government has not engaged any contract with Sattar related business entities and that neither are there plans of the same,
Kunkuyu said the legal effect of terminating a contract for public convenience is that government as a procuring entity, is under an obligation to pay for goods supplied or goods delivered or goods that were under production at the time of termination.
