RCC, Chinese deal stinks

State-owned enterprises like the Roads Contractor Company (RCC) have been imploding for quite some time and it has been a continuous struggle for them to stay afloat. The RCC has not only been wracked by instability from a management point of view, but its performance over the years has been dismal to say the least. Last year the SOE survived a bid to have it liquidated and was thrown a lifeline after the authorities decided to put its operations under the curatorship of the High Court, which in turn appoints a judicial manager to temporarily oversee its operations. However, this arrangement never materialised, partly due to cabinet being divided on how to move forward with the matter. Granted, the liquidation of the RCC would have resulted in massive job losses, affecting an already constrained economy. The RCC board was then given the green light from cabinet to seek funding elsewhere in order to sustain its operations. At the time, the board claimed it was finalising an off-balance sheet funding solution, which required no government guarantee. It now appears this arrangement was not well thought through and according to finance minister Calle Schlettwein, both the RCC and the Chinese firm Jiangsu Nantong Sanjian (Pty) Ltd completely ignored legal provisions before working out a N$570 million loan agreement. Schlettwein cited the State Finance Act, the new Public Procurement Act, as well as the Public Private Partnership Act, as some of the provisions that were completely overlooked. Some of the road contracts stipulated in the loan agreement were also not budgeted for, further raising questions of unethical behaviour. This shortcut attempt promotes a scenario where corruption and graft is the obvious suspicion, given the fact that proceeds will end up in Chinese coffers, much to the detriment of the local economy, which is already struggling to create new jobs. Any financing deal must include the local economy as a first priority and should be concluded in the interest of the country and not a foreign government or entity. This is what national interest is all about.