Secretary to the Treasury Fredson Yamba insists that there was no illegality in the US$500 million Sovereign Guarantee that was personally signed by President Edgar Lungu and issued in favour of Stag African Investments Limited to finance Zesco, adding that the guarantee was cancelled by Minister of Finance, Margaret Mwanakatwe in April.
But National Democratic Congress leader, Chishimba Kambwili, has described the loan guarantee saga as “an awkward act of corruption.”
According to a press release issued by Yamba, Wednesday, Mwanakatwa recalled and cancelled sovereign guarantee on 24th April 2018.
“The Sovereign Guarantee was signed on 9th September, 2016, by the President of the Republic of Zambia exercising the functions of the Minister of Finance, pursuant to Article 91 of the Constitution of Zambia (as amended by Act No. 2 of 2016), as read together with Section 4 of the Statutory Functions Act, Chapter 4 of the Laws of Zambia, due to the critical need for electricity power imports. It should be noted that this happened before the President appointed his Cabinet,” Yamba stated.
“Since the issuance of the Sovereign Guarantee, all the conditions were fully met by Zesco but no disbursements were made by Stag African Investments Limited over a prolonged period and consequently, the Ministry of Finance made recourse to other financing options in support of Zesco’s need for the critical electricity power imports. In view of these developments, on 24th April 2018, the Minister of Finance, Margaret Mwanakatwe, recalled and cancelled the Sovereign Guarantee issued in favour of Stag African Investments Limited.”
But reacting to the contradictory pronouncements, National Democratic Congress (NDC) political consultant, Chishimba Kambwili, questioned the timing of the cancellation.
“First and foremost, if it was an emergency, why was it cancelled? By [the] fact that it was cancelled, it clearly shows that it was not an emergency. Because if it was an emergency, they would have gotten the money there and then,” Kambwili said.
“When you tell a lie, you cannot be consistent. They just told us that Mutati cancelled Stag; today, Secretary to the Treasury says, ‘it was Mwanakatwe who cancelled.’ Keep on lying, we are taking note of all the statements coming from them.”
He further pointed out that there were clear links between Stag Africa and Lusaka-based lawyer, Lewis Mosho.
“Stag head office is at Mosho’s company; the famous PF government lawyer. For a fact, that is where their head office here in Zambia is. And where people like Mosho are involved, obviously, one can smell a rat. That’s why Amos was trying by all means to try and say that this is a South African company because he knew that when certain names start popping up and being connected, the Zambian people will see that this issue is an awkward act of corruption,” Kambwili narrated.
“To try and defend a lie, you will not be consistent because you will be giving different kinds of explanations. As a result, you are opening yourselves more to ridicule and losing integrity.”
Kambwili, the PF Roan member of parliament, also cautioned Yamba not to be used to facilitate suspected wrong-doing by his superiors.
“And the Secretary to the Treasury, my brother; anyway, I won’t say much because he is my brother in marriage. I can only tell him to be careful and not to accept to be used because this Stag deal; whether it was cancelled or it was not executed, it still remains that in the history of the whole world, one great president in the name of Edgar Lungu, signed a guarantee! It’s never done, all over the world, it is never done,” Kambwili observed.
He expressed grief at the mounting controversial revelations in the PF government.
“I feel sorry for the people in government today; I think I am looking forward to meeting President Edgar Lungu one-on-one. Maybe, there is something wrong that we don’t know. If I met him one-on-one and try and advise him or learn from him why these things are happening, we can help our country,” bemoaned Kambwili.
“So, my next step, what I am thinking, is that I need to meet President Edgar Lungu and discuss some of these issues, so that I can get from the horses’ mouth and give him my own piece of mind or advice. I am becoming worried of my brother, Edgar Lungu. We may differ politically, we may differ principally, but I think he still remains my brother. As a citizen, I am duty-bound to meet him one-on-one and discuss these issues.”
The controversial Stag loan was originally unearthed by an Africa Confidential report where Zesco would acquire and service a US $500 million loan, but that only US $350 million would be transferred to the utility.