The Central Bank of Kenya (CBK) has been flagged by Auditor-General Nancy Gathungu over irregularities in awarding a Ksh 14.5 billion tender for printing new currency notes to the German firm Giesecke+Devrient Currency Technologies GmbH (G+D).
The tender, which covers the printing of 2.04 billion banknotes over five years, has come under scrutiny for violating key procurement laws.
According to the Auditor-General’s report, the CBK failed to follow the required procurement regulations stipulated in the Public Procurement and Asset Disposal Regulations of 2020.
Central Bank of Kenya Governor Hon. Kamau Thugge
Specifically, CBK did not appoint a special committee as mandated for such tenders, raising concerns about possible insider dealings and collusion within the procurement process.
CBK Governor Kamau Thugge, in his defense, admitted that the tender process was carried out under the approval of both the National Security Council and the Cabinet.
Thugge further explained that the decision was influenced by the urgent need to avoid a potential shortage of currency, particularly of the Ksh 1,000 note, which could have destabilized the economy.
Auditor General Nancy Gathungu during a past media presser. Photo: Citizen Digital Source: Facebook
Despite this explanation, the Auditor-General’s report has raised questions about the transparency of the process. The absence of a special committee, as required by law, has brought the deal into the spotlight, with fears that bypassing these regulations could have opened the door to improper dealings.
The awarding of the tender to G+D followed the exit of British firm De La Rue, which previously handled the printing of Kenyan banknotes.
De La Rue closed its Nairobi operations due to a lack of orders, leading to significant job losses and financial repercussions for the company.
The report is expected to fuel further investigations into the tendering process, with the CBK now facing increased scrutiny over the Ksh 14.5 billion deal.
