DBC chewed up N$120m — First hints of political undercurrents emerge

GOVERNMENT spent N$120 million bailing out the Development Brigade Corporation (DBC), the parastatal set up for ex-soldiers.

The expenditure on the failed parastatal was the main revelation at the Presidential inquiry into DBC and Amcom, which started public hearings yesterday, with a hint that national politics will feature alongside administrative irregularities. Eldorette Harmse, Legal Counsel for the Presidential Commission of Inquiry into the Activities, Affairs, Management and Operations of the defunct Amalgamated Commercial Holdings (Amcom) and DBC, sketched the DBC as having been a troubled organisation virtually from the beginning.Soon after it was started in 1992, for training and job creation to ease ex-combatants into society, the DBC “lost focus and quickly became a commercial entity”, with 12 subsidiaries though only four began operating.Government gave the DBC start-up capital of N$13 million.In addition, four subsidiaries incurred losses of N$13,5 million between 1997 and 2000.None were able to make a [single] repayment on the loan, said Harmse, which meant the DBC had to bail them out.The DBC itself ran up huge debts after going into a 50-50 joint venture with the Malaysian Construction Ventures Overseas (MCVO) to form M&N.The joint venture borrowed US$9 million (N$37 million at the time) from a Malaysian bank to build houses.DBC failed to repay the loan, and the Ministry of Finance forked out N$94 million last year to pay the loan, which had ballooned because of the depreciation of the South African rand against the US dollar, interest and penalties.The Namibian dollar is linked on a one-to-one basis to the rand.Harmse gave an indication that the total loan had been repaid to Bank Industri Malaysia Berhad, which had given the loan to the DBC in March 1994 for its house construction company.Bank Industri also owned the majority shares in City Savings and Investment Bank (CSIB) until three years ago.CSIB itself was struggling to survive and was bought by Swabou.The first hint that axed Minister of Foreign Affairs, Hidipo Hamutenya, will feature at the hearing, as expected, also emerged.Hamutenya’s name came up in a cursory reference made by the first witness, Sakeus Ndhikwa.Ndhikwa, now a State House employee, mentioned Hamutenya, the late deputy minister Nangolo Ithete and businessman Ben Hauwanga in questioning why their names were not part of a 1995-6 annual report of the Namibia Bricks Enterprises (NBE) that listed where and for whom the subsidiary drilled boreholes.”Three boreholes where allegedly there [for Hamutenya],” said Ndhikwa, who made it clear throughout his testimony that most of his comments were based on hearsay.He said the drilling of boreholes took place at Ombumbu.The drilling is part of what in 1992 was reported as a borehole scandal, in which nine ministers and a string of deputy ministers were accused of using drought relief aid to ensure that water was available in their home villages.A Cabinet investigation later exonerated all the ministers except Minister Without Portfolio Ngarikutuke Tjiriange and Ithete, then Deputy Minister of Home Affairs.The Cabinet report said Hamutenya’s boreholes were not drilled with drought aid but by the DBC.Hamutenya said yesterday that he had paid, in two instalments for the drilling done by the Namibia Bricks Enterprises (NBE), a DBC subsidiary.The Commission of Inquiry is likely to attract huge political interest.Supporters of Hamutenya view it as a witch-hunt following the nomination race in Swapo to choose the party’s candidate for State President.Hamutenya lost to Minister of Lands, Resettlement and Rehabilitation Hifikepunye Pohamba following an acrimonious campaign spearheaded by President Sam Nujoma.Swapo insiders said Nujoma vilified Hamutenya, alleging to his comrades that Hamutenya was close to “imperialists”.The effects of the campaign, which included Higher Education Minister Nahas Angula, linger and have caused a rift within the party, leading to mistrust and paranoia.Yesterday, however, Ndhikwa, devoted most of his time to property that went missing at the DBC and its subsidiaries, especially NBE.The hearings are scheduled to continue until November 12, three days before the National Assembly and presidential elections.It is still not clear how many witnesses have been subpoenaed or whether Hamutenya is among them.Eldorette Harmse, Legal Counsel for the Presidential Commission of Inquiry into the Activities, Affairs, Management and Operations of the defunct Amalgamated Commercial Holdings (Amcom) and DBC, sketched the DBC as having been a troubled organisation virtually from the beginning.Soon after it was started in 1992, for training and job creation to ease ex-combatants into society, the DBC “lost focus and quickly became a commercial entity”, with 12 subsidiaries though only four began operating.Government gave the DBC start-up capital of N$13 million.In addition, four subsidiaries incurred losses of N$13,5 million between 1997 and 2000.None were able to make a [single] repayment on the loan, said Harmse, which meant the DBC had to bail them out.The DBC itself ran up huge debts after going into a 50-50 joint venture with the Malaysian Construction Ventures Overseas (MCVO) to form M&N.The joint venture borrowed US$9 million (N$37 million at the time) from a Malaysian bank to build houses.DBC failed to repay the loan, and the Ministry of Finance forked out N$94 million last year to pay the loan, which had ballooned because of the depreciation of the South African rand against the US dollar, interest and penalties.The Namibian dollar is linked on a one-to-one basis to the rand.Harmse gave an indication that the total loan had been repaid to Bank Industri Malaysia Berhad, which had given the loan to the DBC in March 1994 for its house construction company.Bank Industri also owned the majority shares in City Savings and Investment Bank (CSIB) until three years ago.CSIB itself was struggling to survive and was bought by Swabou.The first hint that axed Minister of Foreign Affairs, Hidipo Hamutenya, will feature at the hearing, as expected, also emerged.Hamutenya’s name came up in a cursory reference made by the first witness, Sakeus Ndhikwa.Ndhikwa, now a State House employee, mentioned Hamutenya, the late deputy minister Nangolo Ithete and businessman Ben Hauwanga in questioning why their names were not part of a 1995-6 annual report of the Namibia Bricks Enterprises (NBE) that listed where and for whom the subsidiary drilled boreholes.”Three boreholes where allegedly there [for Hamutenya],” said Ndhikwa, who made it clear throughout his testimony that most of his comments were based on hearsay.He said the drilling of boreholes took place at Ombumbu.The drilling is part of what in 1992 was reported as a borehole scandal, in which nine ministers and a string of deputy ministers were accused of using drought relief aid to ensure that water was available in their home villages.A Cabinet investigation later exonerated all the ministers except Minister Without Portfolio Ngarikutuke Tjiriange and Ithete, then Deputy Minister of Home Affairs.The Cabinet report said Hamutenya’s boreholes were not drilled with drought aid but by the DBC.Hamutenya said yesterday that he had paid, in two instalments for the drilling done by the Namibia Bricks Enterprises (NBE), a DBC subsidiary.The Commission of Inquiry is likely to attract huge political interest.Supporters of Hamutenya view it as a witch-hunt following the nomination race in Swapo to choose the party’s candidate for State President.Hamutenya lost to Minister of Lands, Resettlement and Rehabilitation Hifikepunye Pohamba following an acrimonious campaign spearheaded by President Sam Nujoma.Swapo insiders said Nujoma vilified Hamutenya, alleging to his comrades that Hamutenya was close to “imperialists”.The effects of the campaign, which included Higher Education Minister Nahas Angula, linger and have caused a rift within the party, leading to mistrust and paranoia.Yesterday, however, Ndhikwa, devoted most of his time to property that went missing at the DBC and its su
bsidiaries, especially NBE.The hearings are scheduled to continue until November 12, three days before the National Assembly and presidential elections.It is still not clear how many witnesses have been subpoenaed or whether Hamutenya is among them.