Parliament probes $41 million South Sudan grain deal

A Parliamentary Select  Committee on South Sudan Compensation is probing Uganda’s role in the infamous sorghum (dura) supply saga in which companies that received payments for cereals from the government of South Sudan government, never delivered them.  

The South Sudan government reportedly paid up to $1 million (Shs3.7 billion) to numerous domestic contractors to supply food to the country ahead of a then a projected famine in 2008.

Under the purchase, the government of South Sudan had sought to stock dura (sorghum), a staple food in South Sudan.

However, the food was never delivered, starting what was later referred to as the Dura saga. 

A team of World Bank auditors established later that 290 companies were paid without signed contracts and another 151 companies were overpaid. It has since been established that many of the companies involved lacked the capacity to source the required amounts of grain, while others displayed high-risk red flags.

Subsequent investigations have indicated that several companies involved were shell companies that were set up hurriedly to be awarded multi-million dollar contracts

Members of the the committee on South Sudan compensation probe say they will review the matter to ascertain whether there were Ugandan companies involved in the rip off.

Committee chairperson, Ms Ann Maria Nankabirwa, says they intend to find out whether some Ugandan companies that [sought or are seeking payment], supplied hot air.

The committee has in recent weeks been reviewing a payment of $41 million (Shs152 billion) advanced to 10 Ugandan companies that supplied goods and services to South Sudan between 2008 and 2013, when war broke out.

The 10 companies, under the Uganda South Sudan Grain Traders and Suppliers Association Ltd, got a contract to supply maize and sorghum to 10 South Sudan states under the Strategic Grain Reserves between 2008-2010, valued at $56 million (Shs208 billion).

 Under the agreement, the money was to be paid in five instalments.

However, the South Sudan government only paid the first instalment of $15 million (Shs56 billion), leaving a balance of $41 million (Shs152 billion) prior to the outbreak of the civil war in 2013.

Uganda has since secured parliamentary approval to clear the debt on behalf of the South Sudan government to traders who have been verified.

The South Sudan government will then refund the money based on a repayment schedule agreed upon in a five-year Bilateral Agreement that runs from 2018- 2022.

The companies that were subject to the 2010 Memorandum of Understanding between Uganda and South Sudan include Rubya Investments, Kibungo Enterprises, Aponye (U) Limited, Afro Kai Ltd, Swift Commodities Establishment Ltd, Sunrise Commodities, Ms Sophie Omari, Apo General Agencies, Ropani International and K.K Transporters. 

Others that were not included on the list include; Roko Construction Company, Ake-jo General Enterprise, JB Traders, Odyek Ejang Company, Dott Services, Gunya Company Limited, Premier Mompany, MFK company, among others.

Committee had earlier observed that they need to meet South Sudan government officials on the compensation matter. 

Meanwhile, suppliers have called on the government to expedite the process of compensation saying they are losing their property and many of them getting out of business.

According to Geoffrey Okwir Gunya, who is demanding up to $88,000, several Ugandans have lost their capital and investments because of the nature of trading in South Sudan. He said Parliament should speed up the process to ensure that the traders are compensated equitably.