Merger proposed for loss-making tourism SOEs

Windhoek: In a desperate bid to turn around the prospects of non-performing hospitality and tourism parastatals, the Ministry of Environment and Tourism recently proposed that the Windhoek Country Club Resort and Casino, Namibia Wildlife Resorts (NWR) and the Zambezi Waterfront and Tourism Park (ZWTP) be incorporated into a single holding entity.

The Minister of Environment and Tourism, Pohamba Shifeta, said the three parastatals, which are registered as commercial entities, will be incorporated into one holding company, because they are lagging behind several other statutory bodies under the ambit of the environment and tourism ministry.

He said if entities that are meant to make money are not run on a commercial basis, there is no need to keep them. “These are commercial companies. As a company, first and foremost, you need to make money for the shareholder. They should be run on a commercial basis. They are just milking the coffers of the public.

“I have the responsibility to advise Cabinet as to what is to be done with these three companies. We are not the Red Cross or a welfare [organisation]; we need to make money.”

Shifeta also disclosed that he is in talks with the Minister of Public Enterprises, Leon Jooste. “He understands the hospitality and tourism industry and concurs with me,” Shifeta said, but could, however, not confirm whether the holding company would fall under his ministry or under the public enterprises ministry once Cabinet gives its approval.

He is hopeful though that within three years the single entity will be up and running. Further he said – after thorough evaluation – the ministry found that the three companies would best be structured under a holding company, with subsidiaries. He said they would still have autonomy, albeit under one board.

Shifeta said that although the Windhoek Country Club Resort and Casino has been doing well over the years since government took over, the other two hospitality and tourism parastatals have not been so profitable, hence they need government bailouts.

“I don’t sleep well if we have one of our companies making losses. We have some parastatals that are doing well due to the evaluation and monitoring system we’ve put in place, but some are not.”

Shifeta identified training as one of the major stumbling blocks to commercially run hospitality and tourism parastatals. The ministry oversees nine statutory bodies, the majority of which Shifeta praised for their good performance.

“The board is a contributing factor in any company. If the board is not competent, then they will continue supervising incompetent management. If management is incompetent, there is no need to keep that management,” Shifeta stressed.

Shifeta revealed these plans last Wednesday during a three-day retreat of the ministry’s management to review, adjust and re-work their strategies. The retreat ended Friday.