|February 4, 2011
First cement plant inaugurated
Namibia has officially transformed from a net importer of cement into a net exporter, following the inauguration yesterday of the N$2.5 billion Ohorongo Cement Factory, outside Otavi. The biggest private German investment in post-independent Namibia, Ohorongo is a breath of fresh air to the country’s industrial transformation aspirations and an investment in the true sense of the word. The investment in Ohorongo is a timely intervention to Namibia’s growing needs for cement, having relied on foreign suppliers for the product that is central to the country’s infrastructural development and industrialization dreams.
President Hifikepunye Pohamba, who officially launched the factory amidst pomp and fanfare, was quick to heap praise on Ohorongo owners for sticking to their words when they informed authorities in 2007 that Namibia would be a cement exporter by 2011. The factory, according to owners, would produce 700.000 tons of cement per year, 300.000 of which would be exported and the reminder pumped into the fast-growing local market. With exports, plans are in an advanced stage to supply southern Angola with the Ohorongo brand of cement, as the northern neighbouring country continues with reconstruction after 27 years of a destructive civil strife.
Exports earnings are expected to rake in about N$320 million per year, it was announced.
Pohamba appeared an excited statesman yesterday as he launched the biggest project of his presidency, a cement factory that currently employs 207 workers. What excited him even more is the fact that the country’s current 51.2 percent unemployment rate is set to be reduced because 2000 more jobs would be created through the outsourcing of some of the factory’s essential services and subcontracting. At full capacity Ohorongo is expected to have a total workforce of 300 employees, the company announced.
Ohorongo is expected to produce cement until year 2311 or so says the company, which says its reserves could last for the next 300 years. The European Investment Bank (EIB) has provided a € 82 million loan towards the € 250 million project - funds which will also finance a grinding mill, access roads, railway track and housing facilities for the workforce.
While Schwenk Namibia, a German-owned subsidiary, owns 60 percent of the factory, the Development Bank of Namibia (DBN) is owner of a 10 percent stake, while South Africa’s Industrial Development Corporation (IDC) owns 20 percent. The Southern Africa Development Bank was also expected to seal a stake in the factory, with a deal to this effect supposedly signed last night, according to Ohorongo Managing Director Hans-Wilhelm Schutter. All shareholders have reached consensus that no dividends would be declared within the first five to seven years, an ideal strategy to create stability and ease the burden of repaying loans that the company received from various financial institutions in Africa and Europe.
This is arguably the second largest foreign direct investment in the country after Scorpion Zinc Mine in Rosh Pinah, whose investment value is said to be over N$3 billion.
“We must be proud as Namibians,” President Pohamba said. “At N$2.5 billion, this is a significant investment,” he added. Prime Minister Nahas Angula, who accompanied Pohamba and other high-ranking government officials to the Ohorongo inauguration, said the investment shapes the ideal cooperation between Africa and Europe. “This is a new form of Europe-Africa cooperation. It is good that everything processed here and not exported to Europe for value-addition,” the premier said. Ohorongo is rated among the most technologically advanced cement factories in Africa, boasting technologies such as integrated management system and integrated computer system, among others.