Attorney General Thabo Chakaka Nyirenda has advised the Public Procurement and Disposal of Assets Authority (PPDA) to ensure the law is complied when processing requests for approvals to award contracts commonly known as requests for ‘No Objections’.

The AG’s warning comes following complaints lodged to his office by the Black Business Indigenous Network regarding domination of businesses by non-black businesspersons in various public procuring entities.

Nyirenda: There
is a cartel

The network, according to Nyirenda, alleged there was a cartel perpetrated by foreigners particularly of Asian origin and manufacturers that serve to exclude black Malawian businesspersons from obtaining manufacturers authorisation, a key document that enables businesses to succeed in tendering for business of supplying manufactured goods.

Among others, the network cited Central Medical Stores Trust (CMST), Lilongwe Water Board (LWB), Blantyre Water Board (BWB), Northern Region Water Board (NRWB) and Electricity Supply Corporation of Malawi (Escom) where there is monopoly and unethical business practices perpetrated by non-indigenous business actors.

The AG also said the network alleged the consultant managing the Malawi Traffic Information System (Maltis) deliberately designed or interfered with the system so as to block any black Malawian business person from supplying any cards to the Directorate of Road Traffic and Safety Services (DRTSS).

But in his letter addressed to the director of PPDA dated January 30 2023, the AG reminded the public procurements regulatory body of Section 44 (10) of the Public Procurement and Disposal of Assets Act (Cap. 37:03 of the Laws of Malawi) which stipulates that procuring entities must at all times allocate a 60 percent quota in favour of indigenous black Malawians in respect of procurement of goods and services and 40 percent others for national competitive bidding.

Kujaliwa: We are yet to receive the letter

The letter has also been addressed to the Comptroller of Statutory Corporations, all procuring entities, the director of DRTSS and the Competition and Fair Trading Commission (CFTC).

“It appears the procuring systems by various procuring entities have been deliberately designed to favour businesses owned by non-black Malawians and to evade Section 44(10) of the Public Procurement and Disposal of Assets Act,” said the AG.

He also said he had come across trends in which procuring entities not only provide advance payments to entities owned by non-black Malawians but also provide guarantees for commercial loans that these businesses obtain.

The AG further observed as a result, Section 44(10) was being honoured more in breach than in observance.

The AG also observed issues highlighted in the network’s complaint raised elements of unfair competition and monopoly as such, has requested the PPDA and CFTC to investigate the allegations.

In an interview, Nyirenda confirmed writing PPDA and the others, saying he expected all of them to act on his letter by implementing and enforcement the provisions under the applicable law.

“If they don’t and ignore my letter as well as the provisions, that is abuse of office,” he said.

But on her part, PPDA spokesperson Kate Kujaliwa said yesterday at the time of interview, her office had not received the letter and said would respond once in receipt.

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