More questions on govt, Stanchart deal
Bame Piet | Friday July 18, 2014 14:09
Members of parliament believe the deal, which was signed and operationalised without the legislature’s blessing, is marred with irregularities.
They feel that Finance and Development Minister, Kenneth Matambo, crossed the line in committing government’s guarantee on the deal without parliament’s consideration.
The displeasure has prompted Tonota North MP, Fidelis Molao, to notice a parliamentary question demanding that the minister explain if there was a tender for the loan guarantee facility, whether it was an open or closed selective/tender and the specifications therein.
Molao further wants to know whether other financial institutions responded to the tender both locally and internationally, and whether Standard Chartered presented the best deal for the company.
Molao stated that when the House adjourned last April, there were no clear explanations as to why parliament was denied the opportunity to debate the deal before it was signed. He said the minister simply said the law empowered him to enter into such arrangements without engaging Parliament.
“We just want the minister to come clean. Our issue is why the loan was guaranteed before coming to parliament. How did they arrive at Standard Bank,” he said.
In April, then acting Finance Minister, Vincent Seretse also said Okavango “urgently needed” the funds as it had exhausted its available funding for the purchase of supply from Debswana.
Another MP, who requested anonymity because the noticed question is to be asked by Molao, stated that their engagement with other local banks has revealed that there was no competitive tendering for the facility.
“We have met with a number of senior executives at Barclays Bank, and First National Bank but they all denied knowledge of the tender. You must remember that Standard Chartered was the same bank that was involved in the financing of the Palapye Fengyue Glass Project, and it is now dead. Our concern is whether they are the right candidates to finance this project,” said the MP. Molao stated that they (MPs) are going to demand that the minister produce evidence that indeed there was a tender, and that it was published in the local media. Established in 2012, the Okavango Diamond Company is a 100 percent state owned entity, which independently sells government’s share of Debswana’s production, under a 2011 sales agreement between Botswana and De Beers.
This year, the Diamond Company is contractually entitled to purchase 13 percent of Debswana’s production for independent resale, through the 10 auctions it conducts annually.
Government has said the P700 million guarantee was necessary to enable Okavango to begin purchasing the diamonds from Debswana, for resale via its own auctions.
Meanwhile, Mmegi’s efforts to get a comment from Barclays Bank of Botswana and First National Bank of Botswana spokespeople were fruitless by press time. Standard Chartered Bank Botswana spokesperson, Tummie Ramsden, said: “You will appreciate that as a bank we are required by both local and international laws and regulations to maintain strict confidentiality about customer/client information therefore we cannot comment on customer transactions”.