Government clarifies Presidential Jet sale proceeds

By Banthu Times Reporter 06/03/2014

The Malawi Government on Wednesday clarified the Presidential Jet sale proceeds, saying the money realized was spent on important issues.image

Speaking to journalists in Lilongwe, Minister of Finance Dr. Maxwell Mkwezalamba explained that a Cabinet decision was made to dispose of the Jet, Dassault Falcon 900EX, serial number 38 to Bohnox Enterprises Limited of British Virgin Islands at a price of US$15 million.

“The aircraft was sold to Bohnox Enterprises Limited on 29 July, 2013. Cabinet directed that the proceeds from the sale of the jet should be used to procure essential commodities such as maize, medical drugs for distribution in health facilities and military equipment.

“The military equipment was meant to support the Malawi Defence Force (MDF) during United Nations peace-keeping operations abroad,” Dr. Mkwezalamba said.
Information Minister Brown Mpinganjira and Finance Minister Maxwell Mkwezalamba at the Cashgate Progress Press Briefing in Lilongwe-pic by Lisa Vintulla
He then clarified that the sale of the jet followed a competitive process of identifying a potential buyer as bids were received from three companies including Bohnox Enterprises Limited amounting to US$14, 583, 768 while General Aviation Services of Illinois, United States of America bade US$10, 140, 000 and African Dune Investments of South Africa tabled US$10, 201, 100.

“After the Cabinet had decided to dispose of the presidential jet, bidders were formally invited and we opted for the highest bidder who eventually paid us more than what they bade, that is US$ 15 million upon request from Malawi Government,” he explained.

The Finance Minister also explained the break-down of the proceeds, saying government owed Paramount Group US$19.2 million through military support and asked the buyer of the Jet to channel the money to the Group as debt repayment after seeking legal advice from the Attorney General.

He said the money which was allocated in the Ministry of Defence Vote during 2013/2014 financial year to repay the debt of Paramount Group had to be re-located to other equally important issues of procuring medical drugs worth US$3, 867, 332.50 (approximately K1, 546, 933, 904); Malawi Defence Force equipment for peace-keeping operation worth US$7, 038, 760 (approximately K2, 815, 504, 000) while the other amount worth US$4, 093, 907.50 (approximately K1, 525, 000, 000) was spent on buying maize.

Government, therefore, assured the citizenry that the proceeds from the sale of the Presidential Jet were prudently utilised for the intended purposes.

Mkwezalamba was accompanied by Minister of Defence Ken Kandodo, Chief Secretary to Government Hawa Ndilowe, Deputy Minister of Finance Dr. Cornelius Mwalwanda, among others.