The Kenya-Tanzania cashewnut deal has flopped. This is following failure to comply by Thika-based Indo Power Solutions, the Kenyan firm that had signed a contract with the Tanzanian government earlier on this year. The contract was to cater for the purchase of 100,000 tonnes in stock of cashewnuts. Indo Power solutions has since been thrown out of the deal.
Tanzania’s Minister for Trade and Industry Joseph Kakunda said that the company was required to make full payments within two months’ of signing the contract but was disqualified end of March for failure to meet the requirements within the specific time frame.
Indo Power was the only one in the region but among several foreign companies to bid for the cashewnuts tender and win. According to the terms stipulated in the contract, the buyer was required to pay $180.2 million to the Tanzania government within two months’ time.
According to media reports, the announcement of Indo Power’s disqualification comes at the same time with another made this week by Tanzania’s Deputy Minister for Trade and Industry Stella Manyanya, that the government doesn’t have a specific price for raw or processed cashewnuts and that this time around, the price would depend on negotiations with prospective buyers.
Ms Manyanya was responding to a supplementary question asked earlier by a member of parliament. Cecil Mwambe, the MP, Chadema, wanted to know the actual indicative prices introduced by the government to prospective buyers of raw cashewnuts and for those already processed. She also requested for a clarification over the on-going controversial price rates for a kilogram of cashewnuts.
The deputy minister in her answer added that the government would be looking at costs incurred and the price agreed between buyers and sellers.