Local road contractors raise 'contractual, financial concerns' against Zhong Mei

Four Namibian subcontractors working on a Roads Authority (RA) road construction project have accused Chinese-owned Zhong Mei Engineering Group (Pty) Ltd of crippling their businesses and undermining government’s empowerment drive by allegedly reducing approved quantities.

Zhong Mei Engineering Group was awarded the tender to rehabilitate a 30.4 km stretch of the Karibib–Usakos road at a cost of N$343.5 million. As part of the bid conditions, the company was required to subcontract 25% of the work to Namibian-owned partners.

Four Namibian-owned companies – Ino Investment Holdings, Tangeni OM Trading, West Trading and Alugodhi Trading – were appointed under the arrangement.

The procurement process was conducted through the RA in line with the Namibian Procurement Act and the procurement guidelines of the KfW Development Bank.

In a letter seen by Namibian Sun, the companies informed the RA this week that payment for certified works has allegedly “been withheld or denied without contractual justification”.

One of the subcontractors told Namibian Sun that about 100 workers could be affected by the dispute.

“It’s about 20 employees, more or less. So, you can say it’s around 100 workers in total because we are four companies, and each company has about 20 employees,” the contractor said.

He further alleged that Zhong Mei “is doing whatever they want”, claiming further that “the guys representing the RA at the project are in their pockets.”

The individual, who declined to be named, added: “Imagine, we have been complaining the whole year, since the beginning of 2025, and nothing has been done. We have been writing letters, engaging them, and every time we have a meeting, they pretend it is nothing,” he said.

"Friday is the month-end, and there is no sign of any payment from the main contractor. We all want RA to pay us directly rather than paying us through Zhong Mei, simply because we do not trust them anymore,” he added.

Urgent intervention

The companies wrote to RA chief executive Hippy Tjivikua on 27 January, formally appealing for urgent intervention in what they described as “serious contractual, financial and governance concerns” involving Zhong Mei, which they said continue to prejudice their businesses and undermine fair subcontracting practices.

They further allege that Zhong Mei has, on multiple occasions, unilaterally reduced or cut their measured quantities, despite those quantities having been measured and approved by the consulting engineer and signed off by the main contractor’s project manager.

The letter adds that, despite these approvals, “payment for the certified works has been withheld or denied without contractual justification. This practice violates established contract administration procedures and places undue financial strain on our company.”

The companies further allege that Zhong Mei has carried out work under contracts assigned to local subcontractors and then claimed payment on their behalf without their consent or involvement.

“Examples of such works include, but are not limited to, guard rails and gabion structures. The amounts claimed for these works do not reach us, despite being part of our subcontracted scope. This conduct effectively deprives us of our rightful earnings and constitutes a serious breach of subcontracting ethics and agreement terms,” the letter states.

The subcontractors also accuse the appointed SME mentor of siding with the main contractor instead of safeguarding the interests of local firms.

“When these matters were formally presented to him, he failed to assist or intervene impartially. Instead, he appears to be taking sides with the main contractor, whom he is reportedly financially dependent on through payroll arrangements,” the letter reads.

Another contractor told Namibian Sun on Wednesday that Tangeni Investment and Inno Investments “are suffering the most”.

“You will really feel pity for those guys, man. We’ve been fighting these things individually, but now that we’ve come together as a team, maybe they will listen to us.”

RA attending to matters raised

The RA's Tjivikua told Namibian Sun on Wednesday that contractors and subcontractors should be aware that the most professional way to address such matters is through established internal communication channels.

“The Roads Authority will address every issue raised, but we must be mindful that these contracts are confidential and not everything is for public consumption. There is absolutely nothing newsworthy in this regard,” he said.

“However, to respond to your question, the RA received letters from the subcontractors yesterday, 27 January 2026, and we are attending to the issues raised in accordance with the set contractual guidelines,” he confirmed.

Not aware

Zhong Mei Engineering Group told Namibian Sun it was not aware, at this stage, of any unjustified reductions or non-payment of engineer-approved measured quantities on the TR7/1 Usakos–Karibib Road rehabilitation project.

“All payments certified and approved by the engineer are processed strictly in accordance with the contract and are based on quantities verified on site," the company said.

"Where any adjustments, deductions, or disagreements arise, these are required to be discussed and resolved on site through the established contractual mechanisms involving the subcontractor, the main contractor and the supervising engineer," an email response noted.

"To date, the engineer has not confirmed any certified reductions relating to the allegations raised,” Zhong Mei added.

Zhong Mei confirmed that it had met with the supervising engineer, during which no reports or complaints from the four additional subcontractors or SME partners were raised or recorded.

"The only formal correspondence received was a single letter submitted two days ago, for which a response and a coordination meeting were already being arranged in line with contractual procedures,” the company said.

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