By Hilary Mare
GOVERNMENT will not give any special priority to tenders cut or scaled down last year vowing to re-evaluate them in line with its scope of spending, Confidente has learnt.
Confirming this assertion that has been subject to wide speculation that Government might re-advertise some tenders which were awarded before, Minister of Finance, Calle Schlettwein told this publication that Government will relook at all the projects.
“All tenders will be re-evaluated to see if they suit our development agenda. It doesn’t matter if they were cut or were slowed down they will need to be re-evaluated without any special consideration of those that were in the front line,” he said.
The latest edition of the Tender Bulletin denotes that 362 out of 512 projects on last year’s development budget -over 70 percent- have been scaled down or suspended completely.
Apart from cutting projects, the finance ministry last year also directed Government institutions to suspend the issuing of all new state contracts until the national budget is reviewed.
The directive was made on September 12 2016 by Schlettwein in a letter titled ‘Freezing of awards of new tender contracts and feasibility studies/surveys’.
Essentially, these measures came hot on the heels of another Government decision the previous June to slash the national budget by 7.4 percent which translates to N$4.9 billion from the N$67 billion national budget barely three months after it was presented.
The Ministry of Finance also cut the projected 2017/18 national budget by 3.1 percent. Treasury blames among other things macro-economic factors like a weaker currency, low revenue from the Southern African Customs Union (SACU) and poor performance of economies of the behind the volatile economic conditions country’s major trading partners as the major driving force.
On the downside still, Government domestic debt climbed 39.5 percent y/y and 5.8 percent m/m to N$39.1 billion in December 2016 following a 33.5 percent annual increase in November.
Although Namibia has performed relatively well in the past years because of sustained budgetary support, external factors such as low commodity prices as a result of low external demand and supply factors continue to impact on the production and profitability levels for commodity-based industries.
Late last year, Schlettwein said the country has lost the ability to borrow because less liquidity is available on the domestic market, which makes the financing of the budget not particularly easy. He also cited the limited fiscal space, given the revised macroeconomic and revenue outlook, and the structural challenges Namibia faces in terms of skills formation and unemployment.
In a bid to reign in the budget deficit Government, the Ministry of Finance has had to also freeze filling of any civil service vacancies to raise at least N$750 million needed in drought relief aid to urgently feed nearly 600 000 people.
Confidente. Lifting the Lid. Copyright © 2015