Malawi closes net on grain scam

Hundreds have died in Malawi's famine

Malawian government investigators have recommended that officials who allegedly mismanaged the country's grain reserves be prosecuted.

The move follows an investigation, carried out by Malawi's anti-corruption bureau, which focused on the sale of 160,000 tonnes of the country's strategic grain stocks last year.

The transaction forced the cash-strapped government to borrow $28m in order to make up the shortfall, and exacerbated severe food shortages in the southern African country.

A report from the anti-corruption bureau said several Malawian politicians bought some of the grain and sold it on the open market at a higher price.

Grain board blamed

The bureau blamed officials in the country's grain marketing board ADMARC and the National Food Reserve Agency (NFRA).

"Our investigations have shown ADMARC and the NRFA caused the current maize crisis," the bureau's deputy director, Victor Banda, told the AFP news agency.

Mr Banda said the inquiry had uncovered "possible abuse of office and criminal negligence."

Malawi, facing its worst crop failure in 50 years, has appealed for 600,000 tonnes of food aid to stave off a famine which would put 3.2 million people at risk.

Neighbouring Lesotho, Mozambique and Zambian have also been affected.

Earlier this week, the International Monetary Fund and the World Bank said the region needed $611m in humanitarian assistance, including $507m in food aid.

Faulty book keeping

The lending institutions said the region was facing a total grain shortfall of about 3 million tonnes, with a market value of about $750m.

But the international humanitarian effort has been hampered in Malawi by concerns over poor financial management.

The European Union has asked Malawi to refund about 8 million euros ($8m)in aid which was diverted from its intended purpose.

And the International Monetary Fund, which is pushing for tough economic reforms in Malawi, is withholding $47m out of a $55m dollar aid package due to concerns about overspending.