By Charles Mafa
Zambia’s drug procurement system has plunged into chaos this month, as 38 trucks loaded with medicines and medical supplies were stranded at the Chirundu border post between Zambia and Zimbabwe for a month. This situation follows attempts by officials from the Zambia Medicines and Medical Supplies Agency (Zammsa) to exploit a clearance loophole to embezzle funds.
MakanDay has established that one of the employees allegedly involved in the scheme, was arrested. However, the Zambia police could neither confirm nor deny the arrest of the director for supply planning at Zammsa on Saturday, July 13, for allegedly conniving with the clearing agent to prolong the trucks’ clearance procedure to receive hefty kickbacks from increased customs fees.
The transporter, J & J Transport Zambia office declined to respond to MakanDay’s request for comment, with the company’s legal adviser stating he was not aware of the matter.
A well-placed source at Zammsa, confirmed that 22 additional trucks which arrived earlier in the country were held by the transporter for two months awaiting clearance. These are in addition to the 38 trucks that spent a month at Chirundu.
According to information from the Automated System for Customs Data (Asycuda), a computerized customs management system used by the Zambia Revenue Authority (ZRA) and accessed by MakanDay, the 38 trucks that arrived at the Chirundu border on June 6, 2024, were only cleared on July 6, 2024. These trucks were transporting medicine and medical supplies as part of the third shipment of bulk procurement arranged by the Ministry of Health from Egypt.
MakanDay also spoke to an expert clearing agent in Lusaka, who chose to remain anonymous. After reviewing the Asycuda, the agent explained that no taxes were paid because the ministry of health tax payer identification (Tpin) was used for clearance.
“The declaration indicates that the consignment was purchased from the source in the name of ministry of health and imported into the country in the name of the ministry,” he said. He added that if a third party was involved, it suggests issues of alteration and forgery of documents at the border.
Safety of medicine
The decision by some corrupt officials at Zammsa raises significant concerns about the risks associated with keeping drugs in containers at a hot border like Chirundu for a month, as it compromises their quality assurance.
A source at the Ministry of Health stated that the drugs might not meet the standards set by the Zambia Medicines Regulatory Authority (Zamra) if subjected to tests, and the supplying company could sue Zammsa for not taking proper care of them. Zamra’s role is to ensure that all medicines supplied to Zambians meet quality and safety standards.
Change of system, but the old ways remain
Medical Stores Limited (MSL) was initially established by an Act of Parliament in 1976 to buy, store, and distribute drugs. Later, the government took over procurement responsibilities, allowing MSL to focus solely on storage and distribution. However, in 2021, the government reverted to the old system by scrapping MSL and establishing Zammsa to handle all functions.
The current chaos at Zammsa highlights the complexity of implementing the “new dawn” government’s anti-corruption clean-up plan.
Under the previous administration, most procurement decisions were made by the ruling party secretariat. Consequently, only those close to the former ruling party benefited from medicine supply contracts, leading to a ballooning medicine debt of over US$18.2 billion in 2022.
Zammsa has frequently been embroiled in controversy. In February 2022, the Zammsa board placed the entire agency management on compulsory leave. This decisive step was taken due to ongoing investigations into significant irregularities at the institution, particularly involving the distribution of defective medications sourced from Honeybee Pharmacy in 2017.
There remains a mystery surrounding why drugs and medical supplies intended for Zambian hospitals, already paid for by the government, have been stuck at the border for over two months.
A source at Zammsa disclosed that the current consignment was not approved by the board, and other senior management officials were unaware of it.
Response from Zammsa
In response to a query from MakanDay, Zammsa explained that the failure to clear trucks was due to insufficient funds.
Bradley Chingobe, senior manager for corporate communications, stated, “Due to our increased loads and distribution efforts, our operation budget has equally shot up. However, Zammsa and the transporter managed to clear the consignment, and the trucks arrived in Lusaka as of July 9, 2024.”
However, a well-placed source at Zammsa, who chose to remain anonymous, told MakanDay that the lack of funds at Zammsa is due to inefficient management. The source explained that the new management, led by director general Victor Nyasulu, created new positions and increased salaries without consultations, making it difficult for the institution to operate within its budget.
She also mentioned that Zammsa had failed to clear over 50 trucks carrying assorted medicines and medical supplies from Egypt through the Unified Procurement Authority (UPA) of Egypt.
“It has been more than 23 days since the trucks arrived at the Chirundu border, but they have not been cleared due to Zammsa’s lack of funds to complete the clearance process. We are told that another 22 trucks arrived about two months ago, which have also not been cleared,” she said.
Another source from the ministry of health confirmed that Zammsa had written to the ministry requesting over K5 million to clear the trucks.
“The ministry of health is demanding accountability from Zammsa for how they have spent the operational funds they were given. The minister has consistently asked for transparency and accountability, and the ministry of finance has refused to release any additional money without it,” the source said.
The source explained that Zammsa is supposed to budget for all expenses, including the transportation and clearing of drugs, so that all costs are covered when funds are allocated.
However, since February this year, they have not included money for clearing in their budgets. This has led to some dishonest individuals within Zammsa taking advantage of the situation by engaging their own transporters and clearing agents, resulting in goods being stranded and accumulating “demurrage and storage charges,” which Zammsa is then required to pay.
Media statement from Zammsa
On July 13, 2024, Mr. Chingobe issued a statement that all 61 containers carrying assorted medicines and medical supplies belonging to Zammsa that were recently held by the transporter and clearing agent, pending the payment of associated fees, had been released. He also said the containers were marooned at J & J warehouse in Makeni, pending the payment of demurrage and storage charges by Zammsa.
Mr. Chingobe mentioned that the government has instituted investigations by engaging law enforcement agencies to determine what led to the charges and the exact amount involved.
According to a ministerial statement issued on November 16, 2023, the procurement of medicines and medical supplies was transferred from the Ministry of Health to ZAMMSA in accordance with the Zambia Medicines and Medical Supplies Agency Act No. 9 of 2019.
The government also increased funding for medicines and medical supplies from K1.2 billion in 2021 to K3.6 billion in 2022, and to K4.6 billion in 2023. This increased budget allocation has become a target for some corrupt officials.
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