DBC staff looked the other way because of fear of the ‘big guns’

THE Development Brigade Corporation (DBC) went into an unfavourable joint venture with the Malaysian Construction Ventures Overseas (MCVO), which cost the Namibian Government close to N$100 million, because of political pressure.

According to former DBC director, Rapama Kamehozu, the 50-50 joint venture agreement only favoured the Malaysians, but the parastatal’s directors would have risked dismissal if they had raised that concern. “We (DBC directors) were just rubber stamps.I don’t know if there is anybody in this country who can question ministers.The appointing authority …if they say do this you just do it and complain in your heart,” Kamehozu told the Presidential inquiry into the DBC and Amcom.The DBC and MCVO, through the joint venture, formed M&N and borrowed U$9 million (N$37 million at the time) from a Malaysian bank to build houses.In terms of the loan agreement, only the DBC was responsible for its repayment, a scenario which left the failed parastatal in huge debt.The DBC ultimately defaulted on the loan, and the Ministry of Finance had to shell out N$94 million last year to repay the loan, which had ballooned because of the depreciation of the South African rand against the US dollar, interest and penalties.At yesterday’s hearing, the Commission demanded an explanation on why the DBC had to incur such a huge financial loss and “embarrassment” on Government by signing the agreement.But Kamehozu, who is also a Swapo councillor in the Grootfontein local authority, maintained that the Government, through a five-member Cabinet steering committee, was well aware of and negotiated the contract.Other members of the Cabinet Steering Committee, which was headed by axed Foreign Minister Hidipo Hamutenya, were:current Foreign Affairs Minister Marco Hausiku, Environment and Tourism Minister Philemon Malima, Namibia’s ambassador to China and former minister Kapelwa Kabajani and former Deputy Minister of Finance, Rick Kukuri.Commissioner Brian Nalisa put it to Kamehozu that it was the responsibility of the DBC directors to advise the ministers about problems in the agreement instead of just rubber-stamping their decision.”I think we are in Africa, and everybody knows what I am talking about.It’s true, lets call a spade a spade.Nobody questions the appointing authority …you ask too many questions; tomorrow you’re out,” Kamehozu responded.”These people who were involved in the DBC, they let everything [in the agreement] to be in favour of the Malaysians, do you think they got anything in return?” asked Commission Chairperson Petrus Unengu.Kamehozu responded:”I do not know.I don’t want to sit here and accuse people.””I can only say that things went wrong, but who is Kamehozu or the DBC board to ask questions.”The Commission also wanted know why the DBC let M&N to go ahead with its housing project at Grootfontein despite clear indications that the houses they built were sub-standard.But Kamehozu caused a stir in the house when he flashed an enlarged photograph of President Sam Nujoma visiting the project.”You see this is the President smiling.Everybody was happy [with the project] and if those big guns smile, then you just have to smile as well,” he declared.The photo seemed to attract great interest among the commissioners, with some of them later requesting copies of it.Godfrey Gaoseb, who served as Permanent Secretary of Finance from 1994 to 1996, also told the Commission that the Ministry of Finance provided a guarantee for the loan repayment without thoroughly scrutinising its conditions and possible costs to Namibia.”The guarantee was signed by the Minister (the late ex-Finance Minister Gert Hanekom).Madam, I was an administrator and if someone higher than me tells me to implement something, what do I do,” the former PS said in response to a query by the Commission’s legal counsel, Eldorette Harmse on why the Mnistry had failed to detect the shortcomings in the agreement.”We were told that this is our project and whatever the cost [to Namibia] it should never be a major determinant [whether to give the guarantee or not].”Nalisa asked Gaoseb if he was aware that the loan was initiated by the Ministry of Trade and Industry and not the DBC itself, but the former PS stated that he did not have knowledge of that.Gaoseb also revealed to the Commission that it was not the first time that the Namibian Government had entered into international agreements without giving due consideration to the cost effects.He cited the example of the purchase of Air Namibia’s controversial 747-400 Combi.”We do these kinds of things, we get into these things often.We took another loan which was terrible for us when we decided to buy that plane [the 747-400 Combi],” he stated, without giving further details.”We (DBC directors) were just rubber stamps.I don’t know if there is anybody in this country who can question ministers.The appointing authority …if they say do this you just do it and complain in your heart,” Kamehozu told the Presidential inquiry into the DBC and Amcom.The DBC and MCVO, through the joint venture, formed M&N and borrowed U$9 million (N$37 million at the time) from a Malaysian bank to build houses.In terms of the loan agreement, only the DBC was responsible for its repayment, a scenario which left the failed parastatal in huge debt.The DBC ultimately defaulted on the loan, and the Ministry of Finance had to shell out N$94 million last year to repay the loan, which had ballooned because of the depreciation of the South African rand against the US dollar, interest and penalties.At yesterday’s hearing, the Commission demanded an explanation on why the DBC had to incur such a huge financial loss and “embarrassment” on Government by signing the agreement.But Kamehozu, who is also a Swapo councillor in the Grootfontein local authority, maintained that the Government, through a five-member Cabinet steering committee, was well aware of and negotiated the contract.Other members of the Cabinet Steering Committee, which was headed by axed Foreign Minister Hidipo Hamutenya, were:current Foreign Affairs Minister Marco Hausiku, Environment and Tourism Minister Philemon Malima, Namibia’s ambassador to China and former minister Kapelwa Kabajani and former Deputy Minister of Finance, Rick Kukuri.Commissioner Brian Nalisa put it to Kamehozu that it was the responsibility of the DBC directors to advise the ministers about problems in the agreement instead of just rubber-stamping their decision.”I think we are in Africa, and everybody knows what I am talking about.It’s true, lets call a spade a spade.Nobody questions the appointing authority …you ask too many questions; tomorrow you’re out,” Kamehozu responded.”These people who were involved in the DBC, they let everything [in the agreement] to be in favour of the Malaysians, do you think they got anything in return?” asked Commission Chairperson Petrus Unengu.Kamehozu responded:”I do not know.I don’t want to sit here and accuse people.””I can only say that things went wrong, but who is Kamehozu or the DBC board to ask questions.”The Commission also wanted know why the DBC let M&N to go ahead with its housing project at Grootfontein despite clear indications that the houses they built were sub-standard.But Kamehozu caused a stir in the house when he flashed an enlarged photograph of President Sam Nujoma visiting the project.”You see this is the President smiling.Everybody was happy [with the project] and if those big guns smile, then you just have to smile as well,” he declared.The photo seemed to attract great interest among the commissioners, with some of them later requesting copies of it.Godfrey Gaoseb, who served as Permanent Secretary of Finance from 1994 to 1996, also told the Commission that the Ministry of Finance provided a guarantee for the loan repayment without thoroughly scrutinising its conditions and possible costs to Namibia.”The guarantee was signed by the Minister (the late ex-Finance Minister Gert Hanekom).Madam, I was an administrator and if someone higher than me tells me to implement something, what do I do,” the former PS said in response to a query by the Commission’s legal counsel, Eldorette Harmse on why the Mnistry had failed to detect the shortcomings in the agreement.”We were told that this is our project and whatever the cost [to Namibia] it should never be a major determinant [whether to give the guarantee or not].”Nalisa asked Gaoseb if he was aware that the loan was initiated by the Ministry of Trade and Industry and not the DBC itself, but the former PS stated that he did not have knowledge of that.Gaoseb also revealed to the Commission that it was not the first time that the Namibian Government had entered into international agreements without giving due consideration to the cost effects.He cited the example of the purchase of Air Namibia’s controversial 747-400 Combi.”We do these kinds of things, we get into these things often.We took another loan which was terrible for us when we decided to buy that plane [the 747-400 Combi],” he stated, without giving further details.