Steering Tsumeb to a Regional Economic Hub

April 13, 2015, 2:57pm

Steering Tsumeb to a Regional Economic Hub

A few years ago, Tsumeb was a virtual ghost town. The Tsumeb Municipality Chief Executive Officer (CEO), Archie Benjamin engages Prime Focus Managing Editor Tiri Masawi and Journalist Rosalia David to give an insight into the plans for the future, housing delivery, developmental plans and availing of social amenities.

He also gives an insight on the municipality’s plan to diversify their economic base, as well as the creation of special economic focuses to cut the overreliance on the mining sector.

PF:  Since there is a growing interest from both local and international investors towards Tsumeb, how is the municipality handling the challenges associated with growth in terms of service delivery, provision of social amenities and creating space for investors coming to the town?

AB: Well, as the municipality we have always been at the forefront of growth- specifically business growth in our town. About ten years ago, we started promoting certain competitive advantages of the town. At that time of course our local economy was down, a lot of people did not have jobs, some people relocated elsewhere, and there was limited opportunity for growth. To add to that, the region’s political capital moved to Omuthiya, which resulted in the loss of some economic activity.

 Some people predicted that Tsumeb would become a ghost town, but we were adamant that firstly, as a municipality through council and stake holders- there are certain number of things we could first to create visibility for the town and to tell the world that we are here.

The first thing that we did was to create visibility projects, one of which is the annual copper festival, where we invite investors and Namibians to tell them that we are here.

The concept has grown  from a near commercial exhibition event to include a celebration of our resilience.

The other aspect that we have been doing is to mobilise both council and stakeholders through Namibian Chamber of Commerce and Industry (NCCI), to send the message through what we call business mobilisation.

We made visits to ministries, institutions and parastatals to tell them what we are planning to do, specifically to promote number one aspects of investment because we were thinking we have abundant water here in the  underground aquifer.

 We have fertile agricultural land surrounding the town, we have vibrant farming communities producing fruits and vegetables which are mainly being exported. We have technical skills because of the years of mining that we have here.

 We are centrally located in terms of transport with the Trans Caprivi and the Trans Kunene providing the shortest gateway to Angola. In that respect we also have Tsumeb Katwitwi road as one of the road plans on the national map. We started drumming these up as possible lifelines to Tsumeb because it’s the shortest road to Angola which is currently the largest market in Southern African Development Community (Sadc). We were not sitting here and doing nothing, we got into our cars and drove to NamPort, went to see the ministers to get things done.

The third aspect was we looked at what we have here, and assessed what we can add value to. It is good to have properties but if those properties are not adding value to the town what can we do? So we started with what we call a public private partnership initiative.

We first started with the airport, we went to the Ministry of Works and Air Namibia to look for support but nobody saw the possibility that this airport will be something one day. Nobody ever thought a plane will land there, we came back after not getting any response and then we approached our local investors, and asked them  as part of a partnership lets develop this airport.

 Currently we have completed two hangars providing fueling and landing rights for a certain level of flights. The terminal building has been completed, the idea is to complete the lighting along the runway and to expand the runway and resurface it as well, then provide custom services because the building is already there.

 Part of the building is a restaurant and accommodation facilities so those two, the runway and the lighting is now our focus for the coming year.

We had the Caravan Park, which was just draining our financial resources. It was mainly utilized by tourists, who would stay there for one night, before driving through to Etosha.

We once again approached our investors, and proposed adding value to the partnership by creating a facility there, which could potentially increase the volume of tourists who are coming through here, and of course other Namibians who are looking for accommodation in the area. At the time there were only  three hotels and a couple of bed and breakfasts, which catered to all visitors to Tsumeb.

The investors put in millions and of course we availed land and on that basis we have Kupfer quelle resort there, we also approached some of the Namibian investors that are close to funding for land development.

We were actually the first ones who initiated the concept of public private partnership on land delivery. This was even before the municipality in Windhoek adopted the same idea. It actually took us three years to convince the minister that this project might work.

The project next to Pupkewitz has been completed.  People were saying there will be no houses there, but if you go there you will see that construction is taking place.

In this process we wanted the economy to grow first before taking care of the challenges such as unemployment, housing for low-income people, and challenge of educational training especially technical training.

Now in terms of employment, council came up with a concept that we are still using, while we do business promotions and people coming and establish themselves in different sectors.

 We have what we call placement programmes, where we agree with any investor that comes here, that at least a portion of the employment quota should be drawn from our database before we give them land.

The concept has given us very good results, last year alone we did over 305 job placements of young people within places like Dundee Precious Minerals and Weatherly Mining.

 That is what we did in terms of employment and of course we encouraged all Namibians to come and look for opportunities because we want to make sure that our people who live in Tsumeb get jobs.

With regards to housing we were usually lucky especially in the low income category. We put up a partnership with the Shack Dwellers Association.

 We had a problem with the build together programme here and it was not successful because people were not repaying their loans.

We could have completed over 300 houses. Council then allocated land, and reduced prices and agreed that each group would be assisted in different departments e.g. engineering.

 Our groups are there to help them, we also negotiate with the suppliers, who are mostly local suppliers, like providers of bricks and building materials, in order to reduce the prices to the particular group and then we also help them to transport some of this materials to the site.

These people have been so innovative in building their houses they even use local materials, for example using stones by crushing it and making it smooth to build their houses.

Now I think we have completed over 300 houses. Thereafter- we the council gave them another allocation of 500 houses and we hope we will meet in that demand this year.

 With regard to the high and middle income groups, we felt that it is difficult for us to generate capital out of the services we are rendering, so we invited investors from all over Namibia to express their interest in various projects.

Currently that category has not yielded results, yet because we are just waiting on answers from the ministry.

What happens is that individuals with a lot of space in their back yards end up building flats for their own benefits. However- this year we are looking at it and hoping with this partnership we can complete at least 500 houses within that category by November or December this year.

 

 PF: There are so many challenges that come with growth, there are a lot of mines that came for example B2Gold and other Industries growing too fast, was the municipality ready for this rapid growth?

AB: Yes we experiend very rapid growth within a five year period, you know we were working towards these things and all of a sudden it was a boom!  What happened was that Ohorongo opened up, followed by  B2Gold, and Weatherly MIning.

Because of the history of service skills that Tsumeb has, you will find that big towns benefit from these investments in Tsumeb. Currently we have people that are transported on a daily basis from here to Ohorongo, we have a local company that has got the tender to transport these people to work on a daily basis.

We only had one private hospital but now we have four or six medical centres assisting the population of Tsumeb. We have seen the economy grow with a number of salons, barber shops and restaurants.

 

PF: There has been challenges of serviced land in other towns, how has the municipality of Tsumeb dealt with this issue?

AB: We were very proactive in that we decided to subdivide land to allocate it to developers, because they are the ones with capital. Howver- we also reserved portions of land for our low income groups.

We discovered that if we give too much land to developers they will determine pricing. We have already started rolling out the housing plan and we are targeting to construct about 400 units in the next few years. These houses are built to deal with increase in population caused by the mining boom. We are working closely with the mines.

We have a database for all people that have applied for plots from as far back as six years ago. However,we receive applications every day, but because of lack of land we cannot address all applications immediately.

PF: Two, three years ago the municipality was talking about a five year master plan; how far have you gone with it?

AB: Well the master plan is done, the structure plan was approved last year in November and we are making projections for the next 25 years. This is because there were many people applying for land.  As a municipality we have also taken a stand that aims to cut down on speculation for land. We are currently monitoring those people who apply for land and we want to make sure they use it. So far we have since repossessed some of the land that was lying idle and we make plans to give it to people who want to use it.

PF: There are small towns struggling, you are running a town that has been a ghost town for years, how are you coping financially?

AB: Well, we are also struggling financially. Municipalities do not get subsidies or funding, government only funds specific projects e.g extension services like water, sewerage. So we end up lobbying for the rest from our own initiatives.

When we started we only had a few houses in Soweto because we could not get funding. Soweto was the oldest suburb with no water, no electricity and only communal toilets so we decided to take N$50 000 per month and start building the sewerage line. Now we have the water line.

 After that we decided to build toilets and they were completed last year in November, and then we worked with our partners to put in electricity and we used two million[ZH1] [ZH2] .

There are 90 plots in Soweto and we are trying to clear the place and evict people who are living in shacks and relocate them to behind Oscar Norich Stadium.  We’ve also taken the initiative to see that some of the pensioners who have been living in municipal houses for a long time get ownership.

Some of these people have been living there for more than 40 years and this year alone we are giving 200 houses back to them. However this category has created debt levels in this town and we are now siting with almost N$95 million in arrears.

On top of that, councilors have waived the price of the house amount- so if you pay half its going to be a problem but if you pay off your debts then you will end up just paying the transfer fees which is good so there is nothing extra to pay.

People have taken advantage of the initiative but there are those who are really paying off their debts. The main idea is to give ownership of the houses to the pensioners but at the same time this is a burden to council. We are also aiming to have transferred about 300 houses by the end of next year.

PF: This urgent boom comes with a lot of buying power and now people are saying that Tsumeb is going to be a very expensive town because of the buying power  How will this affect housing prices?

AB: It has already inflated prices, I always tell people council do not have control over market prices.

 A house that cost you N$35 000 in 2001, will currently cost you N$500 000 now. Unfortunately it’s the market that determines these things and we have no control over them.

People have money and you will be shocked to know that there are some people here paying N$6 000 rent. The challenges we are facing is that whenever these rent prices go up sometimes people fail to afford them and that creates problems, as they are evicted from their homes.

PF: Mines don’t last forever -what are the plans that need to be put in place to come up with spin off industry? Do you think you have done enough in terms of planning for life after the mining boom?

AB: We have started but let’s say we’re 40percent there. Our main focus is manufacturing. Right now we have 250[ZH3]  factories being constructed so that when the mine closes down there are other activities. There is, however-still plenty of work to be done.

 Our aim is industrial development that’s why we are named the industrial hub of Oshikoto region and we are launching our private company, which will be diverse and cater for tourist accommodation, solar energy production and mining.

 We have just approved two projects for solar production outside of Tsumeb. The aim is to create social economics interties[ZH4]  ,business there, business here, we are also encouraging business people not just to invest in housing, but rather to diversify their portfolios.

We are also lucky that we have five millionaires who are resident in Tsumeb and they are doing their bit to contribute to the town’s economic development.

PF: What are the major challenges faced by the municipality right now?

AB: The challenges we are facing right now are related to funding because we do not receive any funding from anybody except for a few projects.

We are lucky the government funds us with most of the projects like the extension of electricity etc. At least now we don’t have to struggle like before.

We don’t have to use our revenues anymore, so we are in good place now. Tsumeb is one of the cleanest towns in Namibia and currently it’s a struggle to maintain this, due to the unavailability of cleaning equipment.

 PF: Any development brings crime and all sorts of unsavoury behaviours; what is the municipality doing in minimizing those?

AB: There is alot of money floating with social entrepreneurs traveling from town to town.

Of course when there is money there is always an element of criminality. We have so far created community neighbourhood watches to curb the levels of crime. The good thing is that even the business people are also part of the watch and they also patrol at night. The challenge is also that some of the young people are engaged in abuse of alcohol.

Right now we are discussing the revival of the apprenticeship school with Dundee Precious Metals. To date we have set aside about N$6.8m for the establishment of a university in the town. The university will be offering special science subjects and is also expected to assist with skills development for the surrounding mines.

 

PF: Where does the municipality see itself in five years’ time?

AB: We are aiming to establish a stable financial basis for the municipality. We also want to be able to generate income, to sustain our operations and to solve the environmental  issues and deal with housing issues. We also want to reclaim the prize for Tsumeb being the cleanest city in the country. We are also working on modalities to deal with the unemployment situation.