John Magufuli-led government has opted to cancel a Ksh18 billion deal they had drafted with a Kenyan firm to buy cashew nuts from Tanzania.
Speaking on the recent development, the country’s Industry and Trade Minister Joseph Kakunda, mentioned that they resolved to cancel the deal after the firm failed to fully honor an agreement.
The Kenyan company called Indo Power Solutions had signed an agreement with the Tanzanian government on January 30 to buy 100,000 tonnes of cashew nuts.
Indo Power had signed the agreement with the Cereals and Other Produce Board of Tanzania.
Minister Kakunda stated that the company had failed to finalize important legal procedures.
He further noted that the government has since signed agreements with six other firms.
Kakunda mentioned: “Forget about the company that signed a contract with us in Arusha (Indo Power) because it failed to honor the agreement. We have signed contracts with six other firms, which are now in the process of fulfilling provisions of the agreements. Those that will make payments first are the ones that will collect the merchandise.”
The Minister however rejected to name the six companies, only saying that two of them are local while the rest are foreign-owned.
It is additionally added that the Indo Power firm is “virtually unknown” hence raising questions regarding the company’s registration and capacity, and the authenticity of the officials behind the lucrative deal.