Namibians want out of Chinese abattoir marriage
A string of broken promises has soured relations between the two parties, leading to 40 job losses.
19 October 2021 | Local News
A Namibian firm that was granted a 25-year contract to operate the Eloolo Abattoir at Oshakati wants to terminate its joint venture agreement with Chinese firm Ningbo Agriculture Investment Group, citing broken promises and trade shortcomings.
Kiat Investment Holdings last year partnered with the Chinese-owned company to run the country’s second biggest abattoir jointly for a decade. But less than a year into business, the facility has closed shop.
When Namibian Sun visited the abattoir last week, no activities were taking place, with the only movement that of security guards watching over the property.
The rift between Kiat and Ningbo has since led to the abattoir’s second closure in five years, leaving over 40 workers jobless and hundreds of cattle farmers without an avenue to formally market their livestock.
The Namibian partner has already started engaging other potential partners.
“This is not the end of the abattoir because [we] are at an advanced stage engaging new partners,” Sikunawa Negumbo, a director in Kiat revealed.
One of the objectives of the abattoir was also to facilitate the export of northern Namibian cattle and mutton to China.
Namibian Sun understands the joint venture has struggled to raise sufficient capital to operate the facility.
There are also talks that the Chinese partners are struggling to obtain an import permit to get the Namibian meat products into China. Negumbo confirmed this.
“We are giving Ningbo a week notice to give us a budget estimate to run the abattoir and we are not taking anything less than N$60 million. They are not serious. To run an abattoir is cost-intensive,” he said.
Negumbo said the abattoir has run into trouble with the Oshakati town council due to unpaid municipal bills.
He added that the company knocked on the doors of Agribank and the Development Bank of Namibia, but failed to secure funding.
The Chinese partners allegedly promised to pump N$200 million into the project, but these funds did not materialise.
"They keep making promises, but nothing concrete happens.
“They said they will pay and we cannot wait for them to get an import permit because that will obviously take [a] long [time] and business needs to continue, otherwise we will also lose the abattoir and we cannot allow that to happen,” Negumbo said.
According to him, Ningbo bemoaned the prices of meat in Namibia and Africa as they feel it is “too cheap and doesn’t allow for maximum profits”.
The abattoir’s plan manager, Deon Visser, declined to comment when approached.
Eloolo’s closure is said to be giving Oshana political leadership sleepless nights.
Governor Elia Irimari told Namibian Sun that he will engage the partners to assess how the situation can be reversed.
“We cannot allow the abattoir to close as it has been a great relief to farmers in the northern communal areas [NCA] who could not formally market their cattle since 2016 due to the closure of the place,” he said.
He added the upliftment of livestock farmers in the NCA is dependent on the participation of farmers in the formal/mainstream economy.
The closure of the abattoir will “increase unemployment in the country”, he said, adding that it was “giving hope and opportunity for farmers to make a living off their farming”.
“This was also reducing the burden on the regional offices as people were becoming self-sufficient,” Irimari stressed.
His meeting with the Chinese and Namibian partners is scheduled for this Thursday.