Executive Chairperson of Eos Capital, Johannes !Gawaxab has reiterated the need for Government to loosen its grip in the Information and Communication and Technology (ICT) and electricity sectors to open avenues for independent players to contribute their part.
This comes at a time when Namibia has been struggling to get power projects to avert the effects of the looming power deficit off the ground. Government recently failed to get the controversial 250MW power plant off the ground but the projects has to date failed to take off because of either delays in executing or constant court challenges among bidders. The Government also failed to get the Kudu Power plant off the ground despite making an initial commitment that the project was to be used as a key project for supplying power in the country in the long run.
“The industry you are referring to is very capital intensive and needs a lot of money. I also believe that there is a lot of Government capital in these sectors. There is Telecom which is owned 100 percent owned by the Government and MTC which has a significant stake from Government. This is not really good for business and this is something that needs to change and it’s an issue that I have always believed need to be looked into,”
!Gawaxab reiterated that there is reasonable interest from capital providers and seekers to play a part in the ICT sectors if they are given the opportunity to invest in the sectors.
“It is not necessarily that people are shunning these sectors but we pretty much have to find a way on how we bring the providers of capital and the seekers of capital together. We need to make sure that some of the projects are bankable and at current all the sectors you have mentioned are pushed on the Government balance sheet”
Although there has been significant interest from Foreign Investors in the Namibian ICT sector the country has not utilised the opportunities and most of the deals that were planned failed to materialize in their infancy.
His sentiments come at a time when the Minister of ICT, Tjekero Tweya also revealed that there is a definite need to open avenues for independent players in the sector in a bid to improve competition and also create competition.
Speaking to Prime Focus !Gawaxab on the sidewalks of the launch of Eos Capital in the capital this month !Gawaxab said there is still space for a new player in the ICT sector but there is definite need for private sector to penetrate the highly capital intensive industry to improve service delivery and also create opportunities for other players to penetrate the industry.
! Gawaxab also revealed that his private equity company Eos capital has about N$500 million earmarked for the different business in ICT, water, industrials and tourism. The company which is venturing in a rather new territory of Private equity said they are targeting companies with a balance sheet of between N$10 million and N$19 million.
The money will be used to offer capital injections to those in need of it and are in the scope of the business targeted by Eos Capital. “We have about N$500 million to offer and we can easily turn it into N$1.5 billion of debt within a short period of time.
The Eos Capital Executive Chairperson emphasised that the country needs to also find avenues to nurture local skills in a way that improves the economy. “What we are trying to do today is to make sure that seekers of capital know that we exist. I would not like to believe that we have a shortage of skills per se but I can assure you that there are many Namibians out there who can be lured to come and participate in the economy,” he said.
While arguing on the need for a correlation between Government and private sector in making sure that the economy improves !Gawaxab also reiterated that the country has managed to make significant growth targets since attaining independence 26 years ago. According to !Gawaxab there has been significant growth in the economy as indicated by the improvement of the Namibian Stock Exchange from having only four companies listed on the local bourse in the early 90s to having 40 companies listed to date.
The NSX is now the second largest equities market in the African continent in terms of market capitalization. Although !Gawaxab believes there is a serious need for capital with businesses but the country has not managed to deal with the problem of inequality. He argued that is is rather worrisome that about 10 percent of the population who constitute the rich and affluent are the ones who are controlling the economy. Ironically he also raises eye brows about the 600 000 Namibians who are living under poverty.
He also mentions that Namibia still experience a high rate of unemployment which is at 50% between the ages of 18 to 25.