Banknote minter De La Rue may cease operations in Kenya if the pending joint venture does not sail through, it hinted yesterday. "Well, viability of operations would need to be reviewed by the board if that happens... though I'm not suggesting we'd close down," Robert Hutchison, director of communications said.

Africa sales director Stephen Prior said only 25 per cent of currency printing work at the Ruaraka plant, which has a capacity of 600 million notes a year, is for export. The plant alone has printed 30 different currencies besides other security documents since 1992. "Loss of 75 per cent of our market base would affect viability of operations at the plant," he said.

The firm termed the Sh1.83 billion lost by taxpayers through its dealings with the Central Bank as a "mystical loss" as it seeks to exonerate itself from the accusations. "It never actually happened," commercial legal director Douglas Denham said in a press conference.

The British minter said its mistake in the whole saga was probably having re-tendered to print the notes overseas after the initial tender was annulled. "We don't think we did any wrong," said Denham, "We made the best offer in the first tender to print onshore and bid the lowest price.

But when we re-tendered we made an offer comparable to our overseas competitors." The minter, denying shadowy pressures to have it print currency offshore, said benefits that would have accrued to the Kenyan economy from onshore printing were not considered in the tender process despite lower cost.

"There was no appreciation of having the local facility hence we wanted to be compared with other firms on a level basis," said Hutchison. The firm said it is pleased that the Public Accounts Committee report supports the joint venture with Kenya, but it may yet reconsider local operations if long-term contracts with the CBK are withdrawn.

The PAC in its report said the loss occurred through the price difference between the interim orders from the CBK to the firm to continue printing current banknotes and the cancellation of the contracts for the new generation banknotes in 2007 on the basis of the intended JV. Former finance ministers David Mwiraria and Amos Kimunya were mentioned in connection with cancellation of the contracts during parliamentary debate in November 2011.

The PAC said Kimunya, currently Transport minister, and Prof Njuguna Ndung'u, the incumbent CBK governor, were responsible for loss of the billions and should be held accountable. It recommended that the two are not fit to hold public office and should be investigated further by the Ethics and Anti-Corruption Authority with a view to taking legal action against them and recovering lost funds.