The Roads Contractor Company(RCC) has found a Chinese firm that is said to be interested to avail over N$570 million to the troubled SOE in an attempt to prevent it from being closed down, The Patriot can reveal.
Cabinet last year placed the cash-strapped RCC under judicial management following years of poor performance and accumulating debts. That process has since been shelved.
This is despite that fact that the Cabinet Committee on overall Policy and Priorities, chaired by President Geingob resolved for judicial management.
RCC’s current debts hover in the region of N$800 million. The company is in so much financial trouble it cannot afford to foot the N$7 million salary bill of its employees. Workers are currently being paid by Treasury.
“RCC has teamed up with a Chinese company called Jiangsu Nantong Sanjian (Pty) Ltd on a project participation basis. The Chinese firm will provide a N$570 million loan facility to RCC. However, we doubt this is a loan, it is more like a joint venture,” said a source with intimate knowledge on the happenings at the parastatal.
The Chinese firm is heavily invested in housing, municipal and road engineering projects according to Bloomberg LP.
“RCC has not been fulfilling its mandate because they have simply been outsourcing the jobs they got, they neglected their mandatory responsibility to maintain Namibian roads. The real reason is for t” the source said further.
The decision to invite the Chinese company, this newspaper understands was a compromise decision between the Ministry of Public Enterprises(Leon Jooste) and the Ministry of Works and Transport(Alpheus !Naruseb).
Well-placed sources say Jooste wanted Cabinet to take a decision to liquidate RCC while !Naruseb called for more funds to be injected into the parastatal to save the job of its 400 employees.
RCC has in the past landed in hot water for outsourcing work to Chinese firms.
In the past it subcontracted a Chinese firm to do land servicing work on Goreangab Extension 4 under the Mass Urban Land Servicing project. This was done despite the appointment being rejected by the consultant, Windhoek Consulting Engineers(WCE), in September on the basis that the Chinese company lacks Namibian participation. China State Construction Engineering Corporation was subcontracted for N$27,971,421.27 despite it not meeting all the tender regulations.
The move was criticised at the time because those involved felt Namibian equity participation, as stipulated by RCC’s procurement policy, Tender Board regulations, Procurement Act and the conditions of the contract were overlooked.
China Nantong Sanjian Construction Group Co., Ltd. is a first-grade independent legal entity established in Hong Kong in June 2013, which was developed by the International Marketing Department of Jiangsu Nantong Sanjian Construction Group Co., Ltd. that was set up in 1983. CNTC has a registered capital of RMB 500 million and established operation centers in the US, Hong Kong and Beijing respectively. On January 1, 2015, CNTC was put into operation officially.
The firm’s main business extends to cover overseas construction projects (house construction projects and municipal works), real estate development, comprehensive development of cities and (towns), and integrated development of the planning, construction, investment attraction and operation of industrial parks.
Details on the loan remains sketchy and questions sent to RCC Board Chairperson Fritz Jacobs yesterday did not yield a response.