GOVERNMENT has reportedly opted for an out of court settlement with Anhui Foreign Economic Construction (AFECC) in the N$7 billion Hosea Kutako International Airport refurbishment and expansion tender, Confidente can reveal.
The out of court agreement comes on the back of Government’s court defeat last year following President Hage Geingob’s order for the cancellation of the multi-billion dollar tender for the upgrade and expansion of the airport, which led to AFECC, that had successfully tendered for the contract, to drag Government and the Namibia Airport Company (NAC) to court.
High Court judge Shafimana Ueitele ruled that the Ministry of Works and Transport’s instructions given under section 9 (1) (b) of the Airports Company Act of 1998 to NAC to discontinue all activities relating to the upgrade and expansion of the Hosea Kutako International Airport during December 2015 and communicated to AFECC on January 5 2016, were unlawful and therefore invalid and set aside.
Sources close to Cabinet told Confidente that although the airport upgrade was a priority due to the increasing volumes of air traffic, Government was not prepared to do the upgrade if they go above N$3 billion.
The Chinese Government reportedly concurred with the Namibian Government on the inflated cost of the airport and tasked the AG to protect the Government against foreign currency fluctuation should they agree on a cost for the airport upgrade, said sources.
According to documents at hand, Attorney General, Sakeus Shanghala wrote to the Minister of Works and Transport, Alpheus !Naruseb informing him that Chinese diplomats had approached him expressing deep regret over AFECC taking the Namibian Government to court over the tender and how the Chinese embassy was willing to be mediator between the parties.
“I was delighted to receive a visit from the Deputy Head of Mission: Embassy of China, Mr Li Na, the Second Secretary, Mr Feng Deheng and the Economic and Commercial Counsellor, Mr Ao Xiaoleli, who informed me that they regret the embarrassment caused to the relationship between the two countries when the company Anhui, took the Government of the Republic of Namibia
to court, the company has expressed its desire to engage with the GRN to settle the matter amicably and as such the embassy of the People’s Republic of China in the Republic of Namibia will be amendable to engage the company, Anhui and negotiate the terms of a settlement,” Shanghala wrote in part to !Naruseb.
Shanghala also advised !Naruseb that it would be in the best interests of Government to opt for an out of court settlement instead of appealing and losing again.
“We consider this approach favourable due to the following, Anhui already have a favourable judgement and should we lose the N$7 billion tender and its evaluation would be legitimised (we cannot afford such) and given the involvement of the Chinese authorities, we could make demands such as the abandonment of the judgement and the re-evaluation of the tender etc. Do kindly revert to me with your instructions, and this correspondence is being copied to the Prime- Minister, Minister of Finance and the Presidency,” he wrote.
In response to Shanghala’s letter !Naruseb on February 17 gave the Attorney-General the go ahead to begin the negotiation process. He also revealed that Government wanted to renegotiate the scope and tender price with AFECC.
“The situation at Hosea Kutako International Airport is worrisome as you rightly described in your letter. The ministry is very much concerned about that and we were hoping that the appeal court sitting on March 3 2017 would be set aside and for the ministry to continue with the implementation of project.
“It is therefore a positive move that the Chinese government has taken a decision to intervene in finding a solution where an out of court agreement can be reached and renegotiate the scope and tender price with the company. The ministry concurs with your proposal and herewith instructs the Attorney-General to start the process for negotiations.”
The same day !Naruseb wrote to Shanghala, the Permanent Secretary in the Ministry of Works , Willem Goeiemann also wrote to NAC’s CEO, Tamer El-Kallawi informing him that Government had decided to settle out of court.
“I am pleased to convey to the Namibia Airports Company Ltd Board of Directors and management that government has decided to settle out of court with the Chinese Contractor (AFECC). A decision was made to proceed with the project and I therefore would like to instruct the Namibia Airports Company Ltd to continue to provide technical support to the project to ensure that the designs and implementation thereof are undertaken in accordance with the applicable national and international regulations and standards.
“In light of the above, I invite you together with your technical team to be part of the ministerial steering committee which is to oversee the entire project from its planning stage up to its successful completion; the committee will be chaired by myself (sic).”
When contacted Tuesday, Shanghala refused to comment on the matter saying it was attorney-client privileged information.
“The Office of the Attorney-General is constitutionally mandated with providing legal advice to Government Office, Ministries and Agencies (O/M/A’s) and representing Government in court. In view of the above, the information in the possession of the Attorney-General regarding this matter and any other matter is client-attorney privileged and also due to the fact that the matter is pendente lite the information cannot be disclosed,” Shanghala said.
The Minister of Public Enterprises, Leon Jooste, said he wasn’t aware of the negotiations between Government and the Chinese contractor.
Asked whether NAC doesn’t fall under his ministry, Jooste said the parastatal will only become his responsibility once legislation has been changed.
“The Ministry of Works and Transport is currently still the rightful Minister responsible for the NAC. This will only change once we pass new legislation which will then empower the Minister of Public Enterprises to take full responsibility for all Commercial Public Enterprises.”
Minister !Naruseb, Goeiemann, the Chinese embassy in Namibia and AFECC had not responded to questions sent to them at the time of going to print.
Confidente. Lifting the Lid. Copyright © 2015