Govt bails out ‘unproductive’ Kalimbeza

Government has spent close to N$50 million on the project since 2014, but the farm has made only N$1.8 million from rice sales.

27 March 2020 | Business

The project can be economically viable. - Margaret Kalo, Spokesperson, Agricultural ministry

Edward Mumbuu – The Kalimbeza Rice Project in the Zambezi Region - which was on the verge of collapse - has been thrown a N$7.1-million lifeline by the government to salvage its operations.

Even with the cash injection, farm manager Patrick Kompeli estimates that the green scheme will only generate around N$500 000 in profits this year.

The bailout was made available through the then ministry of agriculture, water and forestry (MAWF) in January.

The farm has not planted rice for the last two years due to, among other factors, disconnected electricity, non-payment of employee salaries, a lack of fuel, uneven fields and wrecked equipment.

Zambezi’s governor, Lawrence Sampofu, in a recent interview with Nampa pointed to under-capitalisation as the chief reason for the project's struggles.

“So, it’s just a matter of putting more funds into the project to make it more productive,” Sampofu said.

Repairs

The governor was, however, quick to note that his office only learned about Kalimbeza’s precarious financial state in November as the project does not report directly to him.

But his office, upon learning that the project was on the verge of a complete shutdown, immediately took up the matter with former agriculture minister, Alpheus !Naruseb.

The allocated funds will now be used to repair the farm’s fence, which is in a dilapidated state, as well as weeding, purchasing of pesticides, paying the electricity bill throughout the year and repairing all the requisite equipment.

Like all other government green schemes, the project falls under the Agricultural Business Development Agency (AGRIBUSDEV).

According to Kompeli, the Kalimbeza Rice Project has the capacity to break even and become a self-sustaining farm if adequately funded for the next five years.

Return on investment

Asked if this was a healthy return on investment, Kompeli said the farm could have been self-sustaining by now, had it been funded adequately and consistently.

Responding to questions sent to the agriculture ministry on the sustainability of the government-run green scheme, spokesperson Margaret Kalo said: “The project can be economically viable. This will be achieved if the current challenges faced by the project are addressed and additional capital for the development of additional land and for operations land are made available.”

Kalo did not respond to questions related to the project's return on investment to taxpayers who have been bankrolling it.

To date, the government has spent close to N$50 million on the project's infrastructure development, information obtained from the ministry shows.

Since 2014, the farm has made N$1.8 million from rice sales.

“Yes it’s true, N$7.1 million was transferred to the Kalimbeza Rice Project account to address the challenges that have been pulling down the project such as field levelling, repair of the fence, repair of all the machinery on the farm and procurement of rice processing machines and inputs,” she said.

UNAM

More so, the situation at Kalimbeza is so dire that University of Namibia vice-chancellor Kenneth Matengu and four senior UNAM lecturers visited the farm recently to appraise themselves with the state of affairs there.

According to Matengu, their intervention was to establish what has gone wrong at the green scheme and see how the university – if requested - can intervene through research and development.

Recently in the National Assembly, former finance minister Calle Schlettwein said green schemes have not yielded the expected results, hence government will start prioritising the types of crops that AGRIBUSDEV will support.

“Food security is the overall objective of agriculture,” he said.

But the minister, now in charge of the agriculture ministry, took particular issue with the management of green schemes, the choices of crops and their financial sustainability and viability of certain crops which need to be addressed as a matter of urgency. - Nampa

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