22 May 2019

Tanzania: Cashew Nut Issues Set in Perspective

Dodoma — AT least six companies have signed a pre-contract with the government to buy all the remaining 223,000 tonnes of cashew nuts stored in different warehouses in the country.

This was said in the National Assembly on Monday, by the Minister for Trade and Industry, Joseph Kakunda, while contributing in a winding up ses sion of the ministry's budget estimates for the 2019/2020 financial year.

Mr Kakunda wouldn't go in detail to divulge the names of the six companies because of the contractual procedures but insisted that by June 15th this year, all piles of cashew nuts will be cleared from the warehouses and farmers get paid.

He said currently, a total of 460 tonnes of cashew nuts that have been processed and packed, were available for sale, while 2,200 tonnes being currently processed, will soon be available for sale.

The minister defended the government's decision to revoke a contractual agreement it entered with a Kenyan company, Indor Power Solution, which had initially offered to buy a total of 100,000 tonnes of cashew nuts.

The deputy minister said the deal was terminated after discovering the incapability of the firm to buy 100,000 tonnes of cashew nuts.

Mr Kakunda insisted that due diligence was strictly conducted before the deal was signed, including getting a go ahead from Tanzanian High Commissioner to Kenya as well as Kenya's High Commissioner to Tanzania.

The minister had to provide a point of clarification after some Members of Parliament raised the red flag on the situation of what they called 'stalled cashew nuts' stored in warehouses across the country.

Iringa Urban legislator, Mr Peter Msigwa had demanded the government to set the record straight, saying it did not conduct due diligence before awarding the deal to the said Kenyan company to buy the cashew nuts. He said failure by the Kenyan company had cost the nation dearly because over the period, the crop's quality had diminished.

The MP also demanded that all government officials who were engaged in signing the deal be taken to task. Clarifying further, the Attorney General (AG) Dr Adelardus Kilangi, also insisted that the government did not err to award the deal to a Kenyan company.

After all, the AG said, the government was led by Sale of Goods Law, which means the government did not incur any loss after terminating the contract with Indo Power Company.

"Mr Msigwa should stop misleading this House...in fact, not a single government official has caused the country into loss because nothing was traded before the termination of that contract," insisted the AG.

Winding up, Agriculture Minister Japhet Hasunga told the House that his ministry will soon enter into bilateral agreements with several countries to get markets for commercial crops.

He also said that the ministry was looking into best ways to ensure that more processing industries are established to buy farming products and export the goods as final product not as row materials.

He also said that his ministry has introduced a marketing department that is specifically charged with searching for markets of all farming produce.

This is why, he said, his ministry was currently registering all farmers in order to know exactly the kind of crops they produce.

Late on Monday, the Parliament endorsed without changes a total of 253.83bn/- which was requested by the ministry. It represents 83.63bn/- up from 170.2bn/- endorsed in the existing 2018/19 fiscal year.

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