Shoe Factory on the horizon

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By Surihe Gaomas WINDHOEK An abundance of hides produced by local tanneries will have a ready-made market once the envisaged August 26 Okahandja Shoe Factory gets underway soon. Once operational, the scheme believed to be economically viable, would not only add value to the products manufactured and sold locally, but would create jobs and boost the moribund economy of Okahandja where dozens of people lost their jobs a few years ago. Recently, Cabinet approved the provision of N$5,3 million to be used for the construction and as start-up capital for the envisaged shoe factory. While some N$2,3 million is needed to cater for facilities, N$3 million has been allocated for capital injection. Speaking to New Era yesterday, the Chief Executive Officer (CEO) of the August 26 Company, James Auala said that the company is still waiting to receive the N$5 million from the Government. Yet, he views the envisaged shoe factory, geared towards manufacturing military boots for the Ministry of Defence as well as shoes for police and prison personnel, as one way of reducing the high importation of shoes from outside Namibia. Currently, Namibia imports 366 374 pairs of shoes from South Africa and other overseas suppliers every year. But according to Auala, the foreign importation of foreign goods could be reduced dramatically once local companies are able to produce their own products from within and generate not only employment, but also the much-needed cash for the local economy. “We are in the defence industry and look into how to service the defence forces. With this shoe factory, there is the possibility of reducing the importation of these things (shoes). Why can’t we venture to do it ourselves and this in turn will reduce expenses on the side of government,” explained Auala. Lately, the Ondangwa-based Northern Tannery has been experiencing high transport costs on hides exports. As a solution however, consultant Harald SchÃÆ’Æ‘Æ‘ÃÆ”šÃ‚¼tt who has been involved in developing the business proposal for the August 26 Shoe Factory said that with the availability of hides in the country, even communal farming communities stand to benefit from this venture. “There is a huge market in this country and shoes can be manufactured at a competitive price,” said SchÃÆ’Æ‘Æ‘ÃÆ”šÃ‚¼tt. He said research has shown that hides from the high number of beasts slaughtered at local abattoirs and even at frequent weddings and funerals could make a positive contribution to the scheme. “Communal farmers and rural people can become involved and this makes great economic sense to the people to collect the hides and sell them. It can happen and this can make communal areas produce a top range of quality products locally,” said the consultant. Once operational, the shoe factory at Okahandja will employ 37 workers from Okahandja who will undergo some training out of the country. There is good supply of technology and machinery. Recently, officials from Mauritius visited the ministry of Trade and Industry and expressed interest in a joint venture. Auala noted that such a venture would further expand their operation base once it gets underway. While at first the factory is expected to start with manufacturing military boots, plans are also in the pipeline to look into making shoes for construction workers, miners, nurses and schoolchildren. At a later stage, it will make handbags, wallets and belts. Local tanneries like Okapuka Tannery, Ondangwa-based Northern Tannery and Nakara have been visited in this regard. Local company Leather Connection has also expressed interest in the shoe factory. “Given the size of the population we hope to meet the requirements. It is only then that we can export and diversify from safety boots to ordinary shoes,” said Auala. He explained that they however see a situation where the shoe-manufacturing venture may not be profitable during the first two years, but will later improve as production progresses. It is also envisaged that Namibia can also export shoes to countries in the region and to markets abroad. The August 26 Okahandja Shoe Factory is a tripartite venture between the Namibian Government under the Ministry of Defence, the Czech Republic and August 26 Holding Company Pty Ltd. The Czech government donated shoe-manufacturing machines. It is reported that the Ministry of Trade then transferred the machines to the Ministry of Defence for onward transmission to August 26 Holding Company. Although the premises for the shoe factory have been secured in Okahandja, immediate alterations and refurbishments need to be done before production can start. In the meantime, August 26 Holdings Company is waiting for the N$5 million from the Government for the shoe factory operations to get underway.