Government to act on Salima Sugar corruption saga

* Over US$30 million has been misappropriated by the company through various dubious deals for the past years

* The Attorney General’s office is taking swift and decisive action to recover the stolen funds

By Sarah Munthali & Gift Chiponde, MANA

The Attorney General Thabo Chakaka Nyirenda has assured Malawians that his office is working on recovering over US$30 million and bring to book the perpetrators involved in the Salima Sugar Company Limited corruption.

Chakaka Nyirenda said this at Capital Hill in Lilongwe when he briefing the media on the forensic audit report on Salima Sugar, which has revealed rampant mismanagement and misuse of resources at the company, saying over US$30 million has been misappropriated by the company through various dubious deals for the past years.

The AG said his office is taking swift and decisive action to recover the stolen funds, adding that investigators, prosecutors and legal experts are working to uncover corruption and financial wrongdoing at the company.

He also disclosed that some company officials, civil servants and other government officials are part of the scheme, saying the law will be applied for such individuals.

“Audit Consults who were appointed as forensic auditors found that Salima Sugar Company Limited was dealing businesswise with related and suspicious companies incorporated in foreign countries, in particular India, United Arab Emirates-Free Zone Area, Seychelles and South Africa.

“Additionally, a senior officer incorporated Salima Sugar Company Limited in Dubai without the knowledge of the Malawi Government. A bank account in the name of Salima Sugar Company Limited was opened in Dubai.”

The AG also said although Malawi’s Exchange Control Regulations require prior mMinisterial or Reserve Bank of Malawi approval before a person acquires a foreign loan or foreign currency-dominated loans, Salima Sugar never obtained prior approval to enter into foreign loans from foreign companies.

He also said although sugar is an important export commodity, no foreign export earnings have been declared by Salima Sugar, emphasizing that “Government has not benefited from forex revenue that Salima Sugar has been earning through exports despite huge investment and profits the company has been generating.

“This is a hindrance to the economic development of the country,” said Nyirenda adding that the Government is currently paying back debts which the company obtained from various institutions without the company’s board’s approval from government.

Present at the press briefing was Minister of Information & Digitalisation, Moses Kunkuyu, who said government will recover the stolen money that has been misappropriated by the company in order to benefit ordinary Malawians.

“Time and again, President Lazarus Chakwera has warned officials not to waste resources,” he said. “We will make sure that there is appropriate management of government resources for better progress of the nation.”

In November 2012, the National Assembly passed the Export-Import Bank of India (loan authorisation) Bill, allowing the Ministry of Finance to borrow the sum of US$76.5 million from the India Exim Bank to finance the development of irrigation network under the Greenbelt Initiative, setting up a refined sugar processing plant in Salima.

In 2015, government incorporated the Greenbelt Initiative Holdings Limited as a wholly state-owned enterprise and in 2022, the shares in GBI Holdings Limited were transferred to the Greenbelt Authority.

Government identified AUM Sugar & Allied Limited (AUM SAL) as a potential partner and established the Salima Sugar Company Limited joint venture in 2015, with a 60% ownership by AUM SAL and a 40% ownership by Malawi Government.