STAFF WRITER
The Ministry of Health and Social Services says it is reforming procurement to cut costs and end medicine shortages, but local suppliers warn the new system is threatening their businesses and could put the country’s medicine supply at risk.
This stand off has now put Namibia’s pharmaceutical industry in open revolt.
Local suppliers accuse the Ministry of Health and Social Services (MoHSS) of freezing tenders and sidelining homegrown businesses in favour of foreign manufacturers, a move they warn could leave hospitals without vital medicines as early as October.
The ministry’s new bosses are tearing up the old playbook, pushing a direct procurement drive they say will end chronic shortages and slash costs. The ministry said engaging suppliers directly could save the country over N$200 million.
“In relative terms, these offers have potentially generated savings of approximately N$221 494 485.81 compared to the weighted average intermediary prices,” said health minister Esperance Luvindao at the press conference last week.
But to local firms, the shake-up looks more like an economic coup, stripping jobs, tax revenue, and hard-earned market share from Namibian companies that have supplied the country’s hospitals and clinics for decades.
Local suppliers are worried. They say the ministry’s “transition” plan could actually weaken Namibia’s local pharmaceutical industry. Many are concerned that the government’s plan to buy medicines directly may break rules and lack transparency. They are asking if the ministry has permission to skip the usual procurement process, if the Treasury approved it, and if the promised savings are worth the potential loss of taxes. Others want to know if the imported medicines are properly registered with the Namibia Medicines Regulatory Council and why local companies aren’t given the same flexibility to import their products.
Behind the scenes, however, officials insist the transition is more nuanced than the public spat suggests. Off the record, a senior ministry insider told Namibia Business Review that local businesses will not be cut out of the system entirely. “Local economic development is important, and locals won’t be ignored,” the official said. “But you can’t run medicines procurement on emergency orders, delivering small quantities at very high prices here and there. We are now transitioning to long-term contracts after the favourable court judgment.”
The official explained that those long-term contracts, which locals had opportunities to bid for, are currently being finalized by the CPBN. The ministry is attempting to stabilise stock availability by sourcing bulk and cost-effective supplies directly from international manufacturers. “I understand the frustration of entities who were used to everything,” the official added. “There are plenty of orders issued, some with deliveries and some still pending. It looks like some of those who pose questions lack core understanding. Exemption does not mean exemption from levies. It’s the same exemption as when they participated,” the official said.
Adding fuel to the fire is the Anti-Corruption Commission’s ongoing probe into a suspected web of graft involving medical tenders, suppliers, senior officials, and former executives. Industry players say this has created an atmosphere of fear and uncertainty, with some suppliers claiming the current freeze is less about reform and more about purging the system.
MoHSS Executive Director Penda Ithindi has rejected accusations of a tender freeze, dismissing them as “utter fabrication” driven by businesses desperate to protect their old monopolies.
He told The Namibian last month that “A proposition that procurement for pharmaceuticals is entirely paused is utter fabrication, most likely by individuals and entities yearning for the perpetuation of the less inclusive and hyperinflationary procurement regime of yesteryear,” he said.
He insisted that while long-term contracts are still being processed by the Central Procurement Board of Namibia (CPBN), the ministry is keeping the supply chain alive through exemptions provided under the Public Procurement Act. “There has been no cessation of contracts as alleged,” he said.
DONT CUT OUT MIDDLEMEN
Not everyone is in favour of the new system of buying directly from suppliers. Swapo Party Youth League central committee member Taddeus Shithigona last week said the new system should not be implemented at the expense of hurting local empowerment. Shithigona said while this step addresses longstanding inefficiencies in the supply chain where intermediaries have often inflated costs and contributed to medication shortages, it must not come at the expense of empowering local businesses, particularly those owned by black businesses.
“To do so blindly, would risk perpetuating the economic disparities entrenched by apartheid, undermining the progressive policies of affirmative action and Black Economic Empowerment (BEE) that have been central to Namibia’s post independence transformation,” he said.
Shithigona said, instead, the government should prioiritise accountability, compliance and quality assurance to foster an inclusive economy that lifts the previously disadvantaged without compromising prudence.
“While cutting middlemen is a necessary reform, it must be implemented with eyes wide open to history’s lessons. Affirmative action and BEE are not obstacles to progress but vital bridges to a truly equitable society.
By prioritsing accountability, sustainable contribution and deliberate inclusion. Namibia can secure both health for its people and justice for its past,” he said.
Namibia Local Business Association vice president Peter ‘Kanu’ Amadhila said cutting out middlemen from the health industry would lead to job losses.
Investigative journalist John Grobler said no significant job will be lost as tenderpreneurs in the health industry only employed one or two people.
“The tenderpreneur mafia will be upset and more will be getting upset as their tenders suddenly get cancelled for price-grouping. Dr Luvindao needs to jack up her personal security, because someone might just get crazy enough to try and whack her,” he said. nbr
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