Maravi

Govt single-sources for Mongu-Kalabo road

Govt single-sources for Mongu-Kalabo road
By Mwala Kalaluka
Sun 17 Jan. 2010, 04:01 CAT

PRESIDENT Rupiah Banda’s government has ignored concerns by the Road Development Agency (RDA) by single sourcing a Chinese contractor to undertake the completion of the controversial Mongu-Kalabo road at a cost of US$250 million, sources have revealed. But finance minister Dr Situmbeko Musokotwane has assured that whatever will be done in the procurement of funds for the Mongu-Kalabo road would be devoid of illegality.

Well-placed sources said the government recently signed a contract with a Chinese contractor, Avis International Holding Corporation, to undertake the redesign and construction of the Mongu-Kalabo road project despite the RDA classifying the financial agreement on which it was hinged on as bad.

The sources said the contract which is expected to cost K1.3 trillion involved supervision of the redesigning and construction works on 34 kilometres of the over 70 kilometres stretch.

The source said the RDA commented on the financial agreement after it was taken to the institution following its passage from the Ministry of Finance and Ministry of Works and Supply during its consideration phase.
“That issue of single sourcing will come to haunt them,” the source said. “How can you single source on such a big amount of money?”

The sources said the government’s decision to single source the Chinese contractor had closed local contractors’ access to the bidding process.
The sources said the implications of single sourcing would be more serious for the country if the government was borrowing the money to do the road from a commercial bank in China.

“China has assisted the government to look for the money at US$250 million. The problem is that that is the cost of the project and if the government is made to borrow from a commercial bank in China, it means they have to pay interest. It means the cost can’t be US$250 million,” the sources said. “The Chinese want that project and they have assisted Zambia to look for money from China from a commercial bank.

“We are going to spend US $250 million to cover only 34 kilometres when 74 kilometre cost only K145 billion. This time we are going to do 34 kilometres at K1.3 trillion.”
The sources wondered why the government was in such a hurry to secure the money for the completion of the road project and why the government had single-sourced the contractor from China.

“We hear that they have signed the contract,” said the source.
RDA head of public relations Loyce Saili said the Ministry of Works and Supply was in a better position to comment on the Mongu-Kalabo road project issues.

And when reached for a comment on the matter last Friday, works and supply minister Mike Mulongoti referred all queries to the Ministry of Finance.
“I can’t confirm anything other than that the Minister of Finance was looking around for funding. Call the Ministry of Finance to find out,” said Mulongoti.

And Dr Musokotwane told The Post last week that the government had not yet sourced the K1.3 trillion to finance the completion of the Mongu-Kalabo road project.
“We are still looking for the money but we are confident that it will be found…,” Dr Musokotwane said.
Asked to disclose the source of the road funding, Dr Musokotwane said: “Not at the moment.”

When reminded that there were concerns among some road sector experts over the manner the government was sourcing funds for the Mongu-Kalabo road project from the Chinese, Dr Musokotwane said that should not be a concern.
“Why should that be a concern?” Dr Musokotwane asked. “Money can come from anywhere as long as the terms are acceptable. Just be assured that everything we will do there will be no illegality…absolutely not. Everything will be according to the law, according to the constitution.”

However, home affairs minister Lameck Mangani last week announced to Mongu civil servants that the government had secured the K1.3 trillion for the Mongu-Kalabo road project through a loan facility that was signed with China over two weeks ago.
A government source confirmed that the government had sourced the K1.3 trillion from China and that what was being awaited was for the contractor from China to fly in and seal the contract with the Zambian government.

“A contractor has been found,” the source said. “The money was sourced from China.”
The source said the government had chosen to remain mute on the recent developments until the contract had been signed to avoid pre-emptying anything.

Labels: CHINESE, MONGU, PROCUREMENT SYSTEMS, RDA, ROADS, SITUMBEKO MUSOKOTWANE

posted by MrK @ 6:50 PM