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Promising awarded wheat supply worth ETB 1.56 bln

Promising awarded wheat supply worth ETB 1.56 bln

The Public Procurement and Property Disposal Service (PPPDS) awarded Promising International Trading Co. Dmcc – a major supplier of wheat to the Ethiopia market – to supply 200,000 metric tons of wheat with 1.56 billion birr even though the former accuses the Company for failing to fulfill previous contract to supply wheat, The Reporter has learnt.

It is to be recalled that a couple of weeks ago, the Service retendered the bid to buy 200,000 metric tons of wheat following months of delays whereby Promising had failed to supply the aforementioned bulk of wheat.

The bid was part of a bigger tender where the government was looking for a company to supply 400,000 metric tons. The bid, filled with controversy, finally led to a nationwide shortage of wheat.

It was back in June 2018; Promising won a 1.39 billion birr contract to supply the 200,000 metric tons. During this bid process, Promising has agreed to supply the wheat and later failed to do so.

At the time, Promising agreed to deliver the wheat using vessels owned by the Ethiopian Shipping & Logistics Service Enterprise (ESLSE).

Unfortunately, after the award, controversies regarding freight prices dragged the supply behind. Mainly, the company claimed that ESLSE came up with a new freight price which was not mentioned during the financial opening of the bid, according to Promising representatives.

 After the award, the ESLSE came up with a new price which was USD six million higher than the initial, claimed the same source.

“Promising is supposed to respect its contractual responsibility,” said a procurement expert. “They have no right to say no after agreeing on the contract.”

The Service finally decided to terminate the bid to purchase the wheat.

Concerning the failed contract, PPPDS confiscated a bid bond worth of USD 18,000 by Promising. In addition, the same Service has put forth the Company to the Public Procurement and Property Administration Agency to be penalized.

“We have received the appeal from the Service and already asked for a clarification from the company,” an official from the Agency told The Reporter.

In relation to the latest award, Promising is asked to supply the wheat with 1.56 billion birr on September 21, 2018; the Service issued the award notification letter. Following this, the company is expected to accept the award within seven working days.

In the mean time, in relation to the failed contract which the Service appealed, there is a chance that Promising might lose the latest award if the Agency decides to penalize for its failure to abide by the contract.

The government would have saved a minimum of 175 million birr, if it could have managed to finalize the tender process back in June.