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Meatco borrows from Peter to pay Paul – Schlettwein

2023-02-07  Edward Mumbuu

Meatco borrows from Peter to pay Paul – Schlettwein

Despite paying off commercial bank loans, Meatco’s financial position never improved an inch, as the entity merely borrowed N$437.3 million from the Development Bank of Namibia to pay off the said loans, leaving nothing to write home about. 

The corporation remains in a dire financial state, agriculture minister Calle Schlettwein insists. 

An irate Schlettwein was responding to critics accusing him of driving a crusade to collapse the parastatal to advance the interest of the newly formed Savanna Beef Processors, which is de facto seen as Meatco’s direct competition. 

Savanna Beef Processors was formed to develop and invest in a new beef export processing facility in Namibia. 

A week ago, the minister painted a bleak picture of Meatco. 

Schlettwein’s remarks come days after comments that the meat corporation is technically in the intensive care unit.

Government, Schlettwein proverbially said, must decide to terminate its life support system or breathe new life into its ailing operations. This is seen by certain quarters as a harbinger that the extinction of Meatco is inevitable.

Some have even thrown racial slurs to vilify the minister, who remains unmoved, saying Meatco’s precarious financial
position should not be racialised. 

“I am very disappointed with the racial slant the discussion about Meatco’s fortunes has taken. It should remain a discussion about how the public interest in a public entity can be best resolved,” Schlettwein wrote on his Facebook page. 

He continued: “The Development Bank of Namibia recently published its 2021/22 annual report, ending at 31 March. Meatco loans [with DBN] stood at N$437.3 million. [The] debts to commercial banks were paid off with a loan from DBN. Zero improvement. That is the point. 

“No improvement in the precarious financial situation of a commercial entity, which is pivotal in the Namibian livestock sector, is for sure worrying.”


Paid off

Meatco CEO Mwilima Mwilima Mushokabanji seemingly blew his own horn last week over the loan repayments when he said they paid off Meatco’s historical debts with Bank Windhoek and First National Bank. Mushokabanji said in an interview that whether or not the company should be liquidated is not even a point of discussion. 

He would later buttress this at a press conference on Friday, which sought to shed light on the entity’s state of affairs. 

“One of Meatco’s challenges was the historic debt levels, which were too high. The current board and management, therefore, had to come up with a robust debt reduction strategy to ensure such debts were reduced and paid off.  “When the current board and management took over, Meatco was owing commercial banks, such as FNB N$520 million and N$94 million to Bank Windhoek. I would like to report to you that currently, all historic debts with commercial banks are paid off,” Mushokabanji said, seemingly suggesting the board and management deserved a pat on the back as opposed to criticism. 

He continued that Meatco is the only commercial public enterprise in Africa
that is able to export to luxury markets. 

Meatco, Mushokabanji said, has maintained access for Namibian beef to traditional export markets, such as South Africa, the European Union, United Kingdom and Norway. 

“Through our Norwegian quota, in particular, Meatco has never failed to fill our allocated quota. In fact, Meatco assisted in filling part of the Norway quota for Botswana,” the executive added. 



While some are quick to throw stones at Meatco, the CEO said the entity paid over N$2 billion to producers during the devastating drought that ravaged Namibia between 2019 and 2020. 

“This translated into us contributing 50% to the output of the livestock sector during that year and sustaining primary production.”  

According to him, Meatco has achieved stabilising the industry in which it operates as mandated.  “Meatco continues to pay competitive prices significantly above the South African parity price and higher than the local competitors for slaughter animals. Our prices are currently at N$61 per kg, compared to where it was five years ago when we were paying farmers N$37.7 per kg, south of the veterinary cordon fence (redline),” justified the executive. 

Another success story, he said, is Meatco’s ability to develop new markets. 

“Meatco successfully exported its first beef consignments to emerging markets, namely China in 2019 and USA in 2020. To date, Meatco remains the only export abattoir in Namibia that exports beef to China, and the only in Africa that is certified to export beef to the USA, based on our capacity to meet the stringent
import requirements for the USA market.” 

He also addressed the elephant in the room – its dormant abattoirs. 

“Through Cabinet directives, official handover and budgetary support from the shareholder [government], Meatco is prepared to operate Rundu and Oshakati abattoirs to facilitate market access for the farmers in the rest of the northern communal area to viable potential markets in Africa, the Middle East and Southeast Asia,” he pleaded. 



Some feel Meatco could suffer the same fate as Air Namibia. Back in 2020, the government pulled the plug on Air Namibia after it had to decide between pumping millions into the airline or liquidating it.  

At the time, the government stated it could no longer sustain Air Namibia and, therefore, it would be impossible for the airline to trade out of insolvency.  

The now-defunct national carrier’s debt comprised N$2.3 billion, owed to trade creditors and N$693 million in unpaid taxes.

Despite public condemnation, the government went ahead and liquidated the national carrier, which had been described as a ‘bottomless pit’ that was draining taxpayers’ money with little to nothing to show for it.

Antagonists of the government’s decision still hold the view that Air Namibia’s liquidation was deliberately concocted to advance private interests. 

In January, Swapo Party Youth League secretary Ephraim Nekongo reiterated this gospel.  “We will continue to stand firm that the deliberate liquidation of Air Namibia was a willful move to surrender our air space to the private sector,” Nekongo was quoted by the Economist

However, the Namibia National Farmers’ Union (NNFU) is opposed to the liquidation of Meatco. “We must look for ways to rescue Meatco, as liquidation is not an option… we all know that over the years, things were working at Meatco and it never asked for government bailouts. So, it’s too soon to have that discussion,” Amon Kapi, NNFU’s acting president affirmed recently.

The NNFU, which has been sidelined for years, also wants a seat at the high table to proffer solutions for the bleeding parastatal.   

“Meatco is the only public livestock market for the farmers, and we cannot allow the organisation to go down the drain. We cannot allow our farmers to suffer because of poor management and lack of integrity,” the unionist said.  - 

2023-02-07  Edward Mumbuu

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