Late payments frustrate contractors – NCCI



The Namibia Chamber of Commerce and Industry (NCCI)’s deputy chairperson for the northern branch, Linda Naikaku, says late payments to contractors contribute to poor workmanship and the abandonment of some government projects.
During an interview with New Era, Naikaku said contractors are blamed for shoddy work on capital projects, but government and other service providers contribute to this situation, because they usually fail to pay contractors on time.
Failure by government to pay contractors on time has often left contractors with serious debts and unable to pay their workers. In some cases they buy the building material on credit.
“Contractors are not paid on time, even when they have gone out of their way to get overdrafts from the bank in order to buy material and rent equipment. From time to time contractors find themselves faced with angry employees and subcontractors, who are demanding payment.
“At the same time heavy interest due to nonpayment is added on overdrafts and suppliers that are also demanding payment. In fact a number of people lost their properties, because of debts incurred this way,” she explained.
Even worse, suppliers refuse to provide materials because of the existing debts of contractors, leaving some contractors with no choice but to abandon government projects in frustration. Unlike well-established contractors upcoming contractors suffer the most, as they do not have sufficient funds to sustain them while waiting for the service providers to pay for work done.
“You cannot compare our people with Nexus or the Chinese. Nexus is a giant, while the Chinese are funded by their government. It’s a well-known fact,” said Naikaku. Naikaku, however, urged local businesspeople to enter into joint ventures in order to pool resources. Some people have expertise, some have financial power, and so forth, she explained.
“If you are in the North why not enter into a joint venture with someone who is in Rehoboth or other parts of the country? We are just stuck here in the North, but we are ‘One Namibia One Nation’. We need to mix. We can’t just continue to hide behind the excuse of being previously disadvantaged. We should find ways and means to break this norm,” said Naikaku. She blamed the Tender Board for allocating projects to inexperienced contractors that have never worked under an experienced contractor. In addition contractors with a bad track record are still awarded tenders despite their reputation for poor workmanship.
“If what we see on the news about Onamagongwa Trading is true, it was totally wrong to give them another tender. The Tender Board should look at companies’ history. You cannot reward shoddy work with a bigger project,” she said.
She, however, advised individuals to talk to fellow businesspeople or to the NCCI if they are struggling with their projects. She said businesspeople need to unite, share ideas and where necessary develop solutions together. Nakaiku said most entrepreneurs do not share their troubles on time, as they tend to wait until the situation has worsened and may even have become irreversible. In fact, some simply abandon their projects without saying a word. Naikaku further added that officials in government offices do not give the necessary help to local businesspeople. “Mostly black officials are not helpful, they don’t give information and most of them are not peaceful towards our businesspeople, but they should know that we are here to build our country. We are striving to work towards the Harambee Prosperity Plan.”


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