10% of rail contracts reserved for Nam firms

Contractors working on Namibia's multibillion-dollar railway upgrade must allocate at least 10% of their contract value to Namibian-registered companies or suppliers.Works and transport minister Veikko Nekundi disclosed the local participation requirement while updating the National Assembly on implementation of railway rehabilitation works, including the upgrade of the Kranzberg–Otjiwarongo section.“The bidding and contract documentation for the project stipulates that all contractors are required to allocate a minimum of 10% of the total contract value to Namibia-registered local companies or suppliers,” Nekundi said.He said the project's engineering supervision team had also been directed to structure operations to ensure meaningful participation by local companies and to build the capacity of Namibian SMEs and consultants.African Development Bank (AfDB) procurement records show that Unik Construction Engineering Namibia was awarded a N$252.1 million contract, excluding VAT, for earthworks on the first 50-kilometre section of the Kranzberg–Otjiwarongo railway upgrade.China Jiangxi International Economic and Technical Cooperation Co. Ltd was awarded another earthworks contract worth N$267.6 million, excluding VAT, covering kilometres 100 to 150.If the 10% requirement applies to the full value of these individual construction contracts, the minimum local allocation would amount to about N$25.2 million on the Unik contract and N$26.8 million on the China Jiangxi contract.Government has, however, not disclosed how much has actually been paid to Namibian subcontractors and suppliers under the requirement.Nekundi told parliament that several local companies were participating in consulting, technical, environmental, supply and construction work associated with the railway project.Major upgradeThe railway programme also includes a major rail-supply contract awarded to China Civil Engineering Construction Corporation (CCECC).AfDB procurement records show that CCECC was awarded an N$868.2 million contract in October 2024 to supply rails and turnouts for the Kranzberg–Otjiwarongo section.Nekundi's parliamentary response does not make clear whether the 10% local allocation requirement applies to the rail-supply contract in the same way it does to construction contracts.The Kranzberg–Otjiwarongo upgrade forms part of the second phase of Namibia's transport infrastructure improvement project, which the government and the AfDB jointly finance.The AfDB approved a US$196.4 million loan for the programme in 2023, representing 51.8% of the project's financing, with the Namibian government providing the remaining 48.2%.The programme includes construction of about 207 kilometres of new railway alongside the existing line between Kranzberg and Otjiwarongo, 16 bridges and rehabilitation of two railway stations.It also includes procuring rails for about 518 kilometres of railway covering the Kranzberg–Otjiwarongo–Tsumeb corridor and the Otavi–Grootfontein branch.Nekundi said implementation was progressing, with rails already delivered and construction work under way on sections of the corridor.According to the minister, 8 500 tonnes of rails had been delivered by 22 October 2025, with further shipments scheduled as implementation progressed.The railway is being upgraded towards the Southern African regional standard of an 18.5-tonne axle load as Namibia seeks to improve freight capacity along the network connecting the Port of Walvis Bay to the country's northern transport corridors.RAIL UPGRADE: Works minister Veikko Nekundi says contractors on Namibia’s railway upgrade must allocate at least 10% of their contract value to Namibian companies or suppliers. PHOTO: CONTRIBUTED

10% of rail contracts reserved for Nam firms

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Namibian Sun 2026-09-23

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10% of rail contracts reserved for Nam firms

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Namibian Sun 2026-09-23

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