Lack of foresight, poor implementation, weak policies, and poor coordination are among the reasons why the government’s agro-processing projects have become white elephants.
This diagnosis is contained in a report by the Parliamentary Standing Committee on Public Accounts and Economy, following its regional oversight visit to agro-processing projects in the //Kharas, Otjozondjupa, Zambezi, Kavango West and Oshana regions.
The purpose of the visits was to assess progress made towards the implementation of activities executed under the Agro-Processing Development Projects budgeted under vote 19 of the Ministry of Industrialisation and Trade (MIT), to be implemented by the Namibia Industrial Development Agency (Nida). The projects are funded by MIT under the Special Industrialisation Programme.
For this, the MIT set aside N$31.2 million for the current financial year (FY).
This year’s budget marks an increase when juxtaposed against the preceding FY’s of N$26.2 million, which was channelled towards the agro-processing projects. Chief among the white elephants is the Biomass Project, situated on the outskirts of Otjiwarongo.
Although it is a multimillion-dollar project, it is not operational because the primary investors left the country during the Covid-19 pandemic, never to return.
Sebastian !Gobs, who spoke on behalf of the parliamentary committee, said the project was supposed to be driven by a Finland Coperate in collaboration with Nida.
“The equipment intended for the biomass project is still in sealed shipping containers, and the officials from the ministry’s regional office in Otjiwarongo were not in a position to explain what was in the shipping containers, nor could they provide inventory sheets for the other equipment on site because there was no delivery note when the containers or the other equipment were delivered,” reads part of the committee’s indictment sheet.
“There are six locked containers at the site, and the staff from the ministry could not explain what is in the containers since there was no delivery note left behind!” !Gobs state. The committee also discovered abandoned animal feed and maize grains, together with animal feed production machines, in a warehouse that was not properly secured.
On track
Responding to the findings, the trade minister Lucia Iipumbu confirmed that MIT completed the biomass project at Otjiwarongo during the 2022 -2023 FY. “The biomass project construction has, by March 2023, finalised electrical installation. Final commissioning is slated for the next three months, to be preceded by an open-day training to invite interested Namibians to be taught how to man and operate such a facility,” she said.
Iipumbu said the project intends to commercially demonstrate the production of animal feed, packaged charcoal and char from the utilisation of the vast resources of invader bush.She said once completed, it will give birth to the mooted multi-million-dollar Biomass Industrial Park project, which was expected to boost Otjiwarongo’s economy through the creation of 300 jobs, while also unlocking business markets for locals.
As of March 2024, the ministry had shortlisted at least 100 micro, small and medium-sized enterprises (MSMEs) as potential beneficiaries of the Equipment Aid Scheme (EAS), and 15 enterprises as potential beneficiaries of the Industrial Upgrading and Modernisation Programme (IUMP).
The budgets for EAS and IUMP were N$4 million and N$3 million, respectively. Final announcements and the distribution of equipment and other approved support instruments were expected in April 2024.
She further revealed that the ministry is working with various stakeholders and leveraging the garment centres that were established to develop the key intervention, to ensure that MSMEs can supply school uniforms in all the regions of the country.
The ministry has also initiated basic renovation work on the Ovitoto Garment Factory for the 2024 -25 FY, with equipment already procured.
White elephants
The biomass project is but one of the dormant agro-processing projects identified by the parliamentarians.
In Zambezi, the construction of the Manyeha Crocodile Farm has been on hold since 2018, as it was not budgeted for since then.
Situated in the Kayuwo area of the Kongola constituency, some 110km west of Katima Mulilo, the farm was constructed to the tune of N$27 million in 2014.
Known as the Manyeha Crocodile Leather Processing and Training Centre, this project covers a seven-hectare piece of land, and is supposed to create over 100 temporary jobs during the construction phase, and about 60 permanent jobs once fully-operational.
According to the committee, the project was intended to boost tourism in an area already abounding with conservancies and a national park. It also entails the processing of crocodile leather, and the export of crocodile skin and pricey croc fillets.
However, the officials from the ministry’s regional office in Katima Mulilo told the committee that they hardly receive any updates on the progress of the project from the implementing agency, Nida.
The Manyeha Crocodile Leather Processing and Training Centre, which was once a state-of-the-art structure with a thatched roof, is now vandalised with broken streetlights.
Tracks of elephants were observed on the project, which can pose a danger to security guards on the site, as well as further damage to the infrastructure that is in the open without a fence.
Kalimbeza
Another multimillion-dollar structure that was erected but has since been abandoned and turned into a white elephant over the years in that region is the Kalimbeza rice project.
It has been abandoned for the past year, with no activities happening at the site, the MPs found.
The project falls under the ministry of agriculture, and there has reportedly not been a budget for it for the past two years.
However, President Nangolo Mbumba announced during the country’s 34th Independence Day celebrations in the Zambezi region that the government has provided N$8 million to revive the project.
In the Oshana region, the Ondangwa Tannery project has not been operating for 11 years now.
Reasons cited for the dormancy include upgrades that were done halfway and stopped due to a lack of funds.
The committee observed old and new machines that were locked up in the warehouse, collecting dust.
They also found that the project is faced with vandalism by the local community,
who are cutting the fence at the tannery centre, and illegally removing the lining worth N$11 million at the new ponds.
Nida spokesperson Wessel !Nanuseb has acknowledged the idling of some of the projects, attributing it to the severe budget cuts experienced. He maintained that once additional resources become available, the outstanding work will be completed.
He further said numerous investors expressed interest in the past, but it could not come to fruition. He also pointed out that the inputs of hides to feed the factory are of poor quality, and do not meet the put-through requirements.
Efforts are underway to relook the business model, and make it attractive for potential investors to operate the factory.
– lnashuuta@gmail.com