Millions for State House upgrade, port project
A number of exorbitant capital projects in the recently tabled national budget are raising eyebrows considering the treasury's tight cash squeeze.
Economist Roland Brown recently pointed out that a N$56.8 million allocation for upgrading and renovating State House “in these trying times” pointed to distorted government priorities.
The estimated total cost of this State House project until 2020 is estimated at more than N$120 million. That leaves a balance of N$63.2 million to complete it.
For this financial year it means N$41.5 million will be spent on the construction, renovation and improvement of State House, as well as N$15.3 million for the feasibility studies, design and supervision of the project.
Another project that surprises is the more than N$303 million budgeted during the 2017/20 medium-term expenditure framework (MTEF) for the construction of the Cape Fria harbour project in the Kunene Region that has returned to the national agenda. During the 2018/19 financial year more than N$41 million is earmarked for this harbour project, and N$60 million in 2019/20.
Brown said it was “peculiar” that this project seemed to be back on the cards, given the N$3 billion expansion of the Walvis Bay harbour. Finance minister Calle Schlettwein in January was quoted as saying that there would be no funds available for this harbour project. He said it would only be possible through a public-private-partnership arrangement. If the project goes ahead, Cape Fria would be Namibia's third harbour after Walvis Bay and Lüderitz.
The national treasury has allotted N$45 million for the 2018/19 financial year and N$60 million for 2019/20, with a balance of N$196.8 million outstanding for this project. The government considers this harbour project as an important growth point, not just because this part of the country attracts most tourists but perhaps more importantly for its significant mineral deposits.
Chinese interests
Notably Chinese mining concerns, among others, have moved into the region in a big way through companies such as Namibia Eastern China Non-Ferrous Investment Holding for the exploitation of iron ore near Opuwo, and Namibia Red Earths that has obtained a mining licence for open-pit mining and a processing plant north-west of Khorixas.
Pundits of Chinese investment and infrastructure development projects in Africa have observed that such projects usually are accompanied and bolstered by strategic infrastructural hubs, which host countries are prepared to sponsor or co-sponsor.
As far as a budget allocation of more than N$1.2 billion for personnel expenses for the operations of the 1 763-member 21st Guard Battalion under the Ministry of Defence during the 2017/2020 MTEF period goes, Brown commented: “Just going to leave this one here without comment.”
Schlettwein acknowledged that the government had to a certain extent realised that there must be a move towards the quality of spending, which he said had been introduced.
“But we cannot stop and start everything. It is a gradual turn away from wasteful expenditure,” Schlettwein said.
“Cape Fria is in the most undeveloped part of the country. We have only one single deep-sea port, so I do not see anything wrong in exploring a development project of a deep-sea port in an area of the country that has hitherto not been developed at all,” he said.
Schlettwein also insisted that the resuscitated Cape Fria project had nothing to do with Chinese mining interests in the Kunene Region.
“It has to do with the fact that there are significant mineral deposits in that corner of the country. The Chinese are welcome to invest and so is everybody else. The fact that the mineral deposits are not utilised is because there is no infrastructure that allows for the use thereof and therefore I think we must look into that area and see how we can unleash the economic potential that is hidden there,” Schlettwein said.
Defensive
As far as the wage bill of the 21st Guard Battalion is concerned, Schlettwein again acknowledged that there were efficiency gains that could be brought about, which he said had been started with.
“We have reduced expenditure in defence; we have levelled out expenditure in the other security areas, but do not make the mistake and take peace and stability for granted. If we have the argument that it is not a priority expenditure, then I think we are missing the point. What is correctly mentioned is that maybe we can get more bang for our buck and that we can do with more efficiency. That is the trend that we want to go,” Schlettwein said.
CATHERINE SASMAN
Economist Roland Brown recently pointed out that a N$56.8 million allocation for upgrading and renovating State House “in these trying times” pointed to distorted government priorities.
The estimated total cost of this State House project until 2020 is estimated at more than N$120 million. That leaves a balance of N$63.2 million to complete it.
For this financial year it means N$41.5 million will be spent on the construction, renovation and improvement of State House, as well as N$15.3 million for the feasibility studies, design and supervision of the project.
Another project that surprises is the more than N$303 million budgeted during the 2017/20 medium-term expenditure framework (MTEF) for the construction of the Cape Fria harbour project in the Kunene Region that has returned to the national agenda. During the 2018/19 financial year more than N$41 million is earmarked for this harbour project, and N$60 million in 2019/20.
Brown said it was “peculiar” that this project seemed to be back on the cards, given the N$3 billion expansion of the Walvis Bay harbour. Finance minister Calle Schlettwein in January was quoted as saying that there would be no funds available for this harbour project. He said it would only be possible through a public-private-partnership arrangement. If the project goes ahead, Cape Fria would be Namibia's third harbour after Walvis Bay and Lüderitz.
The national treasury has allotted N$45 million for the 2018/19 financial year and N$60 million for 2019/20, with a balance of N$196.8 million outstanding for this project. The government considers this harbour project as an important growth point, not just because this part of the country attracts most tourists but perhaps more importantly for its significant mineral deposits.
Chinese interests
Notably Chinese mining concerns, among others, have moved into the region in a big way through companies such as Namibia Eastern China Non-Ferrous Investment Holding for the exploitation of iron ore near Opuwo, and Namibia Red Earths that has obtained a mining licence for open-pit mining and a processing plant north-west of Khorixas.
Pundits of Chinese investment and infrastructure development projects in Africa have observed that such projects usually are accompanied and bolstered by strategic infrastructural hubs, which host countries are prepared to sponsor or co-sponsor.
As far as a budget allocation of more than N$1.2 billion for personnel expenses for the operations of the 1 763-member 21st Guard Battalion under the Ministry of Defence during the 2017/2020 MTEF period goes, Brown commented: “Just going to leave this one here without comment.”
Schlettwein acknowledged that the government had to a certain extent realised that there must be a move towards the quality of spending, which he said had been introduced.
“But we cannot stop and start everything. It is a gradual turn away from wasteful expenditure,” Schlettwein said.
“Cape Fria is in the most undeveloped part of the country. We have only one single deep-sea port, so I do not see anything wrong in exploring a development project of a deep-sea port in an area of the country that has hitherto not been developed at all,” he said.
Schlettwein also insisted that the resuscitated Cape Fria project had nothing to do with Chinese mining interests in the Kunene Region.
“It has to do with the fact that there are significant mineral deposits in that corner of the country. The Chinese are welcome to invest and so is everybody else. The fact that the mineral deposits are not utilised is because there is no infrastructure that allows for the use thereof and therefore I think we must look into that area and see how we can unleash the economic potential that is hidden there,” Schlettwein said.
Defensive
As far as the wage bill of the 21st Guard Battalion is concerned, Schlettwein again acknowledged that there were efficiency gains that could be brought about, which he said had been started with.
“We have reduced expenditure in defence; we have levelled out expenditure in the other security areas, but do not make the mistake and take peace and stability for granted. If we have the argument that it is not a priority expenditure, then I think we are missing the point. What is correctly mentioned is that maybe we can get more bang for our buck and that we can do with more efficiency. That is the trend that we want to go,” Schlettwein said.
CATHERINE SASMAN
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