Government’s plan to construct a N$200 million trade hub in Angola has hit rock bottom due to the delay to implement the project and the recent directive to cancel a potential land deal between government and private property company, Afrikuumba.
In a move meant to bolster control over state spending‚ Treasury is demanding information from the Ministry of Industrialisation, Trade and SME Development about its plan to buy land in neighbouring Angola for over N$117 million from Afrikuumba.
The trade hub, according to a 2012 project summary document seen by The Patriot, was supposed to be an access portal and offer facilities to market Namibian business and products in Angola.
The hub, as envisioned, was also supposed to offer Namibian manufacturers, retailers and service providers the opportunity to expand their business into new international markets.
Government sources estimate that the construction cost of the trade hub has escalated to over N$500 million due to the delay in constructing the hub.
The hub, that was earmarked to be constructed on government land in Luanda’s Tatalona area, would consist of nine floors and cover a built area of 7035 square metres. In 2017, the trade ministry started negotiations with Afrikuumba to buy two properties situated next to each other named ‘Afrikaya’ – measuring over 34 000 square metres – for N$117 million. At this stage it is unknown why government decided to divert from its initial plan of constructing the hub in Tatalona.
The proposed properties that the ministry wants to buy from Afrikuumba are situated in the Polo Industrial Area of Viana in Luanda.
According to the valuation report compiled by Nasikama Property Valuation and Consultancy, the buildings on one of the plots consist of A-grade double storey office complex and nine conventional luxury houses. It also houses a number of prefabricated units as well as conventional apartments.
Other improvements include workshops and carports.
The Patriot has been reliably been informed that the land purchased by the Namibian government has been put up for sale.
The Ministry of Land Reform’s Valuer General Rudolf !Nanuseb is said to have travelled twice to Luanda to assess the property to ascertain the price of the offered properties. Although he confirmed compiling a valuation report, he could not divulge the contents thereof. The Patriot understands his valuation was not far off from that of the private valuators.
While Treasury this week called for the negotiations and project to be halted because no Treasury approval was granted, there has been intense back and forth communications between Treasury and the trade ministry.
Finance permanent secretary Ericah Shafudah, in a letter seen by this publication, wrote to Trade PS Gabriel Sinimbo last month demanding that he discloses documents that support the need for government to purchase the property.
This comes after the trade ministry wrote to Treasury in February seeking approval to purchase the property.
The letter includes evidence of recommendations from Ministry of Works and Transport and a valuation report by the Ministry of Land Reform.
The public has opposed the planned acquisition since it was revealed by The Namibian this week, many have been angered by the fact that government wants to spend so much money during an economic crisis which has rendered it incapable of providing basic public services to Namibians.
Shafudah also requested for a cost and benefit analysis of acquisition of the properties and related expenses, versus the development of the prime land that the Ministry has already acquired in Angola.
Treasury has been vigilant towards public spending since the national economy went on a path of descend and it has vowed to protect public funds by preventing ministries and government agencies from dipping into public funds unnecessarily.
Sinimbo was also requested to provide Treasury with a business strategy for the utilisation of the two properties that the trade ministry wants to acquire as well as the estimated cost for improvements that would be required to convert the offered properties into cold storage facilities.
Ministerial team to Luanda
A government-sanctioned team from the Ministry of Works and Transport was dispatched to Angola in April this year to carry out an assessment of the properties owned by Afrikuumba which the ministry planned to purchase.
The report compiled by the committee says that the properties are suitable for use as cold storage facilities, warehouses and related services.
The team also advised the trade minister to consider buying the property.
The group also recommended that the pre-fabricated structures on the property should be demolished as they are not suitable for habitation, hence the price of the property should be renegotiated.
The group also advised that the price offered for the single quarters should be renegotiated as they are not suitable for habitation.
“The Ministry of Industrialization, Trade and SME Development should obtain information about the model, age and frequency of the maintenance of the two generators, water purification machines in the offered property in order to determine and negotiate the price offered on those machines.
Also, information about the age and frequency of the maintenance of the eight water tanks should be considered in the negotiations of the price offered on the water tanks,” states the report signed off by works ministry PS Willem Goeiemann.
Afrikuumba hits back
Afrikuumba businessman Titus Nakuumba this week expressed shock over the fact that Treasury directed that the negotiations be cancelled.
According to Nakuumba, his firm has so far negotiated in good faith and is thus surprised by the directive issued by Treasury this week. Nakuumba highlighted the extent of their commitment to Namibia by divulging details on the payment schedule which would be over a period of four years.
“For now we will wait for the ministry to officially inform us because the negotiations are at such an advanced stage before deciding on the way forward.
So far nothing has been signed and I maintain that the negotiations are clean,” said a visibly disappointed Nakuumba.