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Govt shields dodgy US$400m deal from political scrutiny

by Staff reporter
15 Mar 2022 at 17:07hrs | Views
THE government has ring-fenced a  filthy US$400 million waste-to-energy Pomona dumpsite deal pushed through by Local Government minister July Moyo (pictured) from political scrutiny and possible future revocation by inserting clauses that observers say were meant to safeguard the dubious contract entered into with a Netherlands-based investor.

According to the controversial €304 million (at least US$400 million) deal signed by the City of Harare represented by acting town clerk Mabhena Moyo and Geogenix BV represented by Miliad Lopa whose address was given as 520 H, 1017 EK, Amsterdam, Netherlands, Harare is set to get to generate up to 22 megawatts of electricity under the deal frowned upon by some councillors.

Curiously, Geogenix BV has roped in controversial businessman Delish Nguwaya as its local representative in what sources said was indication of involvement of the First Family in the deal.

Nguwaya is close to the First Family, particularly President Emmerson Mnangagwa's twin sons Sean and Collins, and was mentioned in the controversial Draxgate scandal involving millions of dollars that also roped in the President.

It also emerged that the deal was granted national project status to shield it from tender process requirements and ensure that it cannot be challenged in the event of change of political status quo. To facilitate this, the parties agreed on a "political force majeure event" clause.

The government is unsure who will be in charge of Harare after the 26 March by-elections. In the event that Citizens' Coalition for Change (CCC) councillors retain control of Town House, the deal is likely to be reversed.

Titled "Concession agreement to design, build and operate the Harare Pomona waste management facility and waste energy power plant", the deal signed in the presence of Moyo and Nguwaya has come under scrutiny amid fears the burden to pay millions of dollars will fall on residents ultimately while the political elite in Mnangagwa's government and family are strategically positioning themselves to benefit.

Political force majeure is described in the agreement as: "acts or omissions by any government entity which occur after and which were not reasonably foreseeable on the date of signature of this agreement which have material adverse effect on (i) the ability of the contractor to observe and perform any of its rights and obligations and or (ii) the cost or the profits of such performance."

"Within 30 days of notice to the City of Harare of a Political Force Majeure Event, the City of Harare shall procure the remedy of the Political Force Majeure Event in question," the agreement read in part.

"Should City of Harare fail to procure the remedy of the Political Force Majeure Event prior to the expiry of the 30 day period, the parties shall discuss forthwith in order to reach a mutually satisfactory solution to restore the Contractor to the position it would have been in had such Political Force Majeure Event not occurred (including compensation for costs and loss of profits)," the agreement signed on behalf of the City of Harare by acting town clerk Mabhena Moyo read in part.

"Should the City of Harare fail to remedy or restore within 60 days of the start of such consultation (or if the City of Harare has failed or refused to discuss), the contractor shall have the right to terminate this agreement in accordance with Article 37.2.

The agreement also stated that even if there is to be a change of statute, including on tax, that will not affect the current agreement.

Suspended Harare Mayor Jacob Mafume described the deal as "energetic corruption."

"There is no way such a deal can be legal," Mafume said. "How do we as a landlord give someone a lease and we pay the rentals? It would be criminal to do so," he added.

"This is corruption which has drunk an energy drink or taken Viagra. This deal is not legal, no one can legally execute it .It's not worth the paper it's written on. It is just not workable in any way, shape or fashion," Mafume said.

Mafume said such dubious deals were being pushed by political actors knowing there is little opposition to it after MDC-T leader Douglas Mwonzora recalled at least 24 councillors sympathetic to CCC leader Nelson Chamisa.

"There are numerous such deals. The MDC-T councillors are just there to push corrupt deals."

On the political force majeure, Mafume said: "It means maybe there can be change of government, any other political events or composition of council so they want to legislate knowing the by-elections may change dynamics."

But Mutizwa told The NewsHawks last night that the deal was beneficial to the residents and defended the presence of Moyo and Nguwaya at the signing ceremony.

"Due process was done. Tenderers who came in first during the days of (former) town clerk Tendai Mahachi had no money and wanted to use our memorandum of understanding (MoU) to source for funds. The second tenderers also could not satisfy us and in came this company," Mutizwa said.

"This started in 2018 when they came and met all expectations and financial muscle and the reason why it was elevated to national status by government is for ease of importing needed material and ease of operations," Mutizwa said.

Asked why Minister Moyo was part of the meeting at which the deal was signed, Mutizwa said: "Why the minister came to see me was not because he wanted to influence us. He came at the pretext of us as councillors to hear where government was going to assist us to ease the burden on our residents."

Mutizwa said Nguwaya's involvement was as a result of him being picked by the foreign investor to be their point man in Harare and represent their interests.

The acting mayor claimed there were lots of benefits from the deal and the residents will be the biggest beneficiaries.

"The deal will leave us with a state-of-the-art energy plant and integrated waste management structures, there will be a Pomona restaurant and all the infrastructure will be ours," he said.

It also emerged that three ministers: Moyo (Local Government), Soda Zhemu (Energy) and Monica Mutsvangwa (Information) last year visited some of the company's plants in Albania and Italy.

Engineers from Harare also visited the plants together with the Zimbabwe Development and Investment Agency (Zida) and officials from the Office of the President and Cabinet.

On the clause reportedly meant to shield the deal from future political scrutiny, Mutizwa said: "If any of the parties breaches on the agreement, the clause is careful that they will pay the other. If they fail to satisfy us, we have the right to walk away. The dissolution clause is very clear, any breach on either side, the one who breaches is paying."

He said anything that happens in the 30 years will not affect the project if neither party breaches the contract.

The government said the agreement will be operated by the investor for 30 years and is set to improve waste management and increase power supply.

The investor, the government said, will design, build, operate and transfer the Pomona waste management facility to an energy plant.

Feasibility studies have already been undertaken by the investor after the 29 June 2021Joint Environmental Management Committee, Finance and Development and Business committee meeting that recommended to council to approve the deal.

The project, government said, will be managed and operated by the investor for a period of 30 years before transfer of the project to the City of Harare.

Harare has a history of dubious and costly deals pushed by politicians taking advantage of a vacuum, including the land deals that were pushed before 2008 at a time a caretaker council chaired by Michael Mahachi was in place.

Several Zanu-PF politicians were linked to the deals that saw the city losing huge tracts of land.

Source - NewsHawks
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