AMTA ends Fysal agreement

A controversial deal allowing a private business to trade from the government's fresh-produce hubs has been terminated.

24 May 2019 | Agriculture

Fysal Fresh Produce is to retrench 60 employees at the end of this month after its contract with the Agro-Marketing Trading Agency (AMTA) was terminated.

Fysal is the last remaining private agent to operate from AMTA's Ongwediva fresh-produce hub. The other agent vacated the premises in February after a cabinet directive.

In February last year, AMTA entered into a public-private-partnership agreement with Fysal Fresh Produce to operate from its fresh-produce hubs nationwide, joining four other agents that were already operating at the hubs. Although Fysal was only given a one-year contract, the deal was heavily criticised in some circles. Prime Minister Saara Kuugongelwa-Amadhila visited the Ongwediva hub in September last year after receiving complaints that Fysal was sourcing produce from South Africa and trading it at the government hub..

Critics of the deal, including the Swapo Party Youth League's regional secretary for Oshana, Twiihendeni Israel, claimed that Fysal was an established business while AMTA's hubs were established to help small-scale farmers sell their produce. Fysal Group CEO Ismael David Fysal told Namibian Sun that when they entered into the agreement in 2018, they were given a one-year contract, which could be extended depending on the performance.

“When we were granted permission to operate from AMTA, we realised that it was an ideal place for us to do business. From AMTA we have a distribution network that supplies fruit and vegetables to all the retail shops in Ongwediva, Ondangwa and Oshikango.

“We have 60 employees who are involved in this AMTA operation and we are going to retrench all of them at the end of this month,” said Fysal. “The business was doing very well from our AMTA operation. It was AMTA who approached us to make a joint venture to facilitate the supply of fruits and vegetables and also to assist local produce to get into the market.

“The AMTA people said that for the past five years AMTA business was not doing well and we were assisting them to get in local produce from farmers all over Namibia, and we were also assisting them to get into the market whatever was not produced locally.” Fysal said that he did not have a problem with supplying and assisting local farmers because he has a large workforce and a well-coordinated transport system.

“In January this year AMTA approached me to open up in Rundu as well, and we were busy preparing for the Rundu operation, but in February we were told that our agreement had come to an end and they would not renew it.

“They gave us an extension of three months to sort out everything and retrench those people who were involved in the operation,” Fysal said. Fysal said the termination of the contract was a big loss following the closure of the group's Oshikango operation some years ago. No comment could be obtained from AMTA yesterday.

A source privy to AMTA operation's said the decision to get rid of agents was aimed at the implementation of a cabinet decision that government agencies, offices and ministries in the regions must start procuring all their produce through AMTA.

During the prime minister's visit last year, government departments in the regions were accused of not doing much to support AMTA.

It was reported that government departments procured only about 5% of AMTA's produce, which was why private agents were brought in to help local farmers find a market for their produce.

“The cabinet has issued a directive that AMTA must start supplying all the government entities in the region with fresh produce. AMTA is not allowed to engage a third party in this business and that is why they had to get rid of the agents,” the source said.

The source said AMTA was collecting consumption information from government institutions in the region to establish a logistics and supply plan.

As from next month, AMTA will resume full operation of the Ongwediva hub.

ILENI NANDJATO

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