Office in Namibia, decisions in SA

Officiating on the launch of Dimension Data Namibia on Wednesday in the capital, Ngatjizeko said well established South African firms are muscling out small and upcoming Namibian firms.

The Trade minister said that South African firms operate satellite offices in Namibia whilst decisions are made in South Africa.

He said that the current business relationship between the two countries is not the ‘desirable picture.’

South African firms have a strong presence in Namibia’s wide economic spectrum from retail, mining and financial services sector.

“Most of these companies operate satellite offices in Namibia and these offices have minimal mandates. As a result strategic decisions are taken in South Africa with limited input from their offices in Namibia.

“This state of affairs has led to a situation whereby decisions related to procurement are not made locally,” Ngatjizeko said.

Government has during the past years been increasingly concerned about capital outlfows from Namibia to South Africa and other foreign firms.

The International Monetary Fund (IMF) recently warned Namibia against increasing capital outlfows.

The Fund said that continued capital outflows would keep Namibia’s foreign currency reserves at very low levels.

Namibia’s financial services sector is dominated by South African firms.

“Continued strong outflows of capital to South African financial markets will keep international reserves at relatively low levels,” the IMF said a week ago.

Ngatjizeko said that his ministry has been receiving a lot of complaints from local, emerging entreprenuers whose products and services enjoy little recognition from well established South African retailers operating in the country.

“I hope that we would agree that this is not the desirable picture, and that South African retailers would heed our call and engage local manufacturers with a view of availing shelf space to locally produced goods,” Ngatjizeko said.

He warned that regional integration would not be possible in a region that is characterised by ‘unequal socio-economic development.’

South Africa retail giants such as Checkers, Pick’n Pay, Shoprite, Woolworths, Edgars among others dominate Namibia’s retail sector.

December 2006
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