THE proposed merger between Schwenk Namibia ,and Chinese owned Whale Rock Cement is facing resistance from different groups in Namibia who fear it will create a monopoly and threaten local jobs.
Schwenk Namibia are the majority owners of Ohorongo Cement manufacturing plant in Otavi which has been in operation for the past 15 years.
Speaking at a stakeholder engagement organised by the Namibia Competition Commision (NaCC) on Thursday Otavi Cement Group member, GeorgeGarab said the proposed merger will create a monopoly on the entire manufacturing industry and put the Namibian cement manufacturing industry in the control of foreign hands.
He also raised concern about the ability of Whale Rock Cement to retain local folk in their hiring process.
“As locals we do not have money but we have the power to block this merger.We feel this will leave the entire industry in the hands of foreign nationals.We are also standing on the proposition by the president that local resources must benefit Namibians,” he said.
Chief among Garab’s concerns is the notion of some Chinese owned companies operating in Namibia bringing their own work force at the expense of local job creation.
“ As a local consortium we do not even know how much this merger is worth and we do not understand why it is being kept under the carpet. We have blocked other foreign mergers in the cement industry before and we will do it again. Schwenk Namibia has not even offered a one percent ownership to the owner of the land they are operating on and these are some of the things that still worry us,” he said.
Garab called on the competition commission to shut the door on the proposed merger to protect local procurement.
He believes local Small to Medium Scale Enterprises might not benefit from the procurement systems and methods of the new owners.
Manufacturers Association Chairperson Bärbel Kuschner said the proposed merger spells doom for the construction industry which has been taking a barring since 2016.
We fear that this merger will create favouratism for foreign companies at the expense of the local ones.We are also concerned that the merger will influence Labour hire in the sector. It also has potential to affect the country’s sovereignty,” she said.
She raised concerns that the local construction industry will be subjected to uncompetitive pricing models in future if the entire cement manufacturing industry is put in the hands of one company.
In his sentiment Nick Korb representing the Business Consortium in Namibia argued that the proposed merger does not pass the legal litmus test in the country.
He said the merger is a clear monopoly that will disadvantage local players and dent jobs.
“Questions, though unproven, have been raised about Whale Rock in the past concerning their failure to provide transparent information about their standards . We believe that this merger will create a monopoly and doesn’t satisfy the legal system in the country in competition law. We urge the commission to out right reject this merger,” he said.
Hans-Wilhelm Schütte, the Managing Director of Ohorongo Cement said they are pressing for a sale of their asset in Otavi.
He raised worries about failures to break into the regional market, saturation of the Namibian market as well as competition from imports constricting their ability to grow.
“For the past five years we have been trying to enter the Angolan market and we keep trying but that opportunity is simply not possible. As from 1 August Botswana will put a ban on importation of cement and that will affect the mmmm us.the possibility of job loses when two competitors are in operation is that mmmm same as when one is operating.
Schütte said they are pinning their focus in expanding in Europe as compared to to a smaller Namibia man market that has not offered them growth prospects.
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