‘Rotten apples’ could foment class war: PM

PRIME Minister Nahas Angula has warned against get-rich-quick schemes masquerading as black economic empowerment deals that use public funds but simply collapse their businesses and walk away with millions in ill-gotten gains.

Referring to a simmering scandal at the Government Institutions Fund (GIPF) where more than N$650 million may have been lent without proper collateral, Angula said he found it “difficult to understand” how the GIPF Board could let such things happen. But business deals that only risk capital they have borrowed from the State – without placing any of the promoter’s own assets on the table – were no longer acceptable, especially if such promoters managed to get Government guarantees for their debts, Angula said.”You cannot lend money to someone who does not have any assets,” he said, referring to the now-infamous Namibia Chicken Investments deal in which N$10 million was lost.While the Nando’s franchise was a very viable business, “something seems to have gone wrong in there,” he said.”This is just asset-stripping that they are doing,” he said, depriving the country of scarce economic resources.The GIPF, he said, did not seem to have the capacity to evaluate business proposals brought to it.And if it had referred these deals to Sanlam Investment Management, which has a contract to handle such deals, “Sanlam seems to have been caught asleep,” he said.He said he had warned that if the GIPF went into the business of advancing loans, it would inevitably open itself to political pressure, which would be bad for its business of overseeing Namibian civil servants’ pensions.As for the bad and non-performing loans, he wanted to see more done to bring the parties responsible for losing millions of taxpayer dollars to book.”But there appears to be no movement to bring them to book,” he said.The entire BEE phenomenon was also troubling, as abuse of this otherwise praiseworthy approach was causing the divide between rich and poor to get even bigger, he said.”We have to be careful, otherwise we are going to end up having a class war in this country,” he warned.* John Grobler is a freelance journalist; 081 240 1587But business deals that only risk capital they have borrowed from the State – without placing any of the promoter’s own assets on the table – were no longer acceptable, especially if such promoters managed to get Government guarantees for their debts, Angula said.”You cannot lend money to someone who does not have any assets,” he said, referring to the now-infamous Namibia Chicken Investments deal in which N$10 million was lost.While the Nando’s franchise was a very viable business, “something seems to have gone wrong in there,” he said.”This is just asset-stripping that they are doing,” he said, depriving the country of scarce economic resources.The GIPF, he said, did not seem to have the capacity to evaluate business proposals brought to it.And if it had referred these deals to Sanlam Investment Management, which has a contract to handle such deals, “Sanlam seems to have been caught asleep,” he said.He said he had warned that if the GIPF went into the business of advancing loans, it would inevitably open itself to political pressure, which would be bad for its business of overseeing Namibian civil servants’ pensions.As for the bad and non-performing loans, he wanted to see more done to bring the parties responsible for losing millions of taxpayer dollars to book.”But there appears to be no movement to bring them to book,” he said.The entire BEE phenomenon was also troubling, as abuse of this otherwise praiseworthy approach was causing the divide between rich and poor to get even bigger, he said.”We have to be careful, otherwise we are going to end up having a class war in this country,” he warned.* John Grobler is a freelance journalist; 081 240 1587