Chinese scoop N$900m rail tender

Stunned local bidders say Namibia is a “bad place” for local contractors, who seem to be perpetually excluded from lucrative contracts.

12 December 2019 | Infrastructure

The Chinese state-owned China Gezhouba Group Company Limited has been awarded the tender for upgrading the railway line between Walvis Bay and Kranzberg.

The executive director of the ministry of works and transport, Willem Goeiemann, wrote a letter to the company in which he confirmed the N$895 million contract awarded to them.

Goeiemann wrote to Hu Yuhong – with an address in Wuhan, Hubei Province in China – that the company would be required to furnish a performance security of N$89 503 714 within 28 days of the notification.

The Tender Bulletin of 2 to 8 August reported that the China Gezhouba Group was not mentioned as one of the 20 bidders when the tender closed in October 2018.

China Gezhouba nonetheless made it onto the shortlist, which was dominated by Chinese companies.

The director of rail infrastructure in the works ministry, Robert Kalomho, was quoted as saying in early July that nine out of the initial 21 bidders had failed to submit their bid documents before the closure of the tender.

Stunned local bidders this week said Namibia was a “bad place” for local contractors, who seem to be perpetually excluded from lucrative contracts.

The Walvis Bay to Kranzberg rail project entails earthworks and the laying of tracks and is to be funded from a N$10 billion loan by the Africa Development Bank (AfDB) to the Namibian government.

By late November the works ministry would not say which two companies were considered for the tenders, but by that time it was clear that the tenders would go to Chinese companies. Although Goeiemann's letter does not specify which part of the rail project was awarded to China Gezhouba, it was rumoured that the company would get the Arandis-Walvis Bay section.

It was also rumoured that the joint venture Qingjiang Group/Unik Construction Engineering, consisting of two Chinese companies, was earmarked to get the rail section between Arandis to Kranzberg.

This tender has not yet been announced.

However, local players in the construction industry commented that neither China Gezhouba nor the Unik joint venture lists rail projects on their internet company profiles.

Because of this, it was rumoured, Unik Construction planned to “outsource” as much as 70% of the contract to the South African outfit Aveng.

That would not be consistent with the AfDB rules, which stipulate that no more than 25% of a contract may be outsourced.

CATHERINE SASMAN

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