Zambia’s state-owned grain buying company, the Food Reserve Agency (FRA) is facing a financial crisis. This created concerns about its readiness for the marketing season which opens on June 1.
Executive Director Chola Kafwabulula told a Parliamentary Committee on Estimates the cash shortage is hampering operations.
“We need additional funding to help us dismantle debts owed to service providers, including transport and suppliers of empty grain bags,” Kafwabulula said.
Other debts included rentals and security services, a carryover from 2016.
According to Kafwabulula, the FRA has a budget allocation of K942 million for operations and K80 million for administration.
However, it had only received K153 million in the first quarter of this year.
He said the dire financial situation stalled the agency’s plans to construct countrywide storage facilities, and hampered other capital projects.
He attributed the financial crisis to the lack of input by the agency when the budget was drawn.
On readiness for the marketing season, Kafwabulula said the agency can purchase 500 000 metric tons of maize grain for strategic reserves.
However, Kafwabulula’s reassurance was received with incredulity among lawmakers who listened to the FRA’s performance review.
MP’s quizzed him on how the FRA will pay transporters and other service providers critical to maize buying. The agency also required additional personnel across the country during the marketing season.