Agribusdev sacrifices workers’ salaries

THE state-owned Agricultural Business Development Agency (Agribusdev) sacrificed the salaries of its workers to avoid losing equipment at one of its green schemes in northern Namibia.

Agribusdev, which oversees green schemes countrywide, is on the brink of financial ruin, to the extent that staff will not be paid their July salaries on time.

understands that agricultural products’ retailer Agra Limited notified one of the green schemes – Shadikongoro Irrigation Project – which is situated about 180 kilometres east of Rundu, that it will sue to sell equipment at the project to recover its money.

A person familiar with this matter said Agribusdev’s management opted to redirect the funds meant for salaries to partially pay the Agra debt.

This is described by a source as a desperate bid to prevent the project’s equipment from being attached and auctioned.

It is unclear how much was diverted from the salary obligations. The company’s 2017 annual report states that it has 130 employees.

Information seen by shows that Agribusdev’s managing director, Petrus Uugwanga, wrote to banks on 23 July 2019, notifying them that payment of staff members’ salaries will be delayed.

“This memo serves to inform your esteemed bank that Agribusdev will not be able to pay salaries to its staff members by 25 July 2019, the payday,” he stated.

Uugwanga added: “In light of the above, we are requesting for your kind indulgence to assist our staff members who may not be able to meet their obligations with banks or third parties due to the delayed salary payment in any way”.

He then assured the banks that salaries will be paid before the end of July.

Uugwanga told yesterday that “the [salary] delay is simply because we do not have sufficient funds at this point in time to run the payroll, and to pay for goods and services rendered. We are awaiting our dues to be paid for us to be able to pay”.

He added that their budget approval by the ministry is not the answer because the agency would still have to raise money to fund activities, and rejected claims that money meant for salaries was being redirected to pay the Agra debt.

“We indeed owed Agra, and we have a settlement agreement which shall end at the end of August 2019. We are still in business with Agra, hence it’s not in the interest of any parties to disclose the figures”.

“But it is less than a salary of one farming centre. We are paying Agra from money generated by the farm that used inputs from Agra – how that became salary money I really do not know. We just started harvesting and we are paying them, and we remain on good terms,” Uugwanga said.

Shadikongoro farm manager Danny Marais yesterday confirmed the Agra debt, but refused to reveal how much they owed.

“We have a big harvest, and once we sell the produce, we will have enough money to permanently solve it. Please speak to head office if you want more information,” said Marais.

The Shadikongoro saga comes a few months after Agribusdev nearly lost equipment at another green scheme.

In February 2019, the High Court gave Agra Limited the green light to auction Agribusdev assets at the Ndonga Linena Irrigation Project in Kavango East to recover their money.

The assets included five tractors, planters, a Krone baler, rotary cutter and other smaller equipment. The auction was set for 20 June 2019, but was called off after Agribusdev solicited funds to settle part of the debt.

Agribusdev also owes suppliers millions, and some have since taken the company to court. The government is yet to approve the company’s budget for the current year.

Uugwanga told earlier this week that Agribusdev is “not on ground zero” when it comes to finances.

“We need additional funds to operate at optimal level. Our production could run over a N$100 million, and our turnover could be over N$300 million. Hence, the amounts being talked about are very insignificant. We have started paying all our suppliers, and over and above that we have a business arrangement through which payments would be made,” he said.

The green scheme warned workers last month to prepare for “unfavourable events” due to continued financial troubles.

Agribusdev’s finance manager, Natanael Amoomo, informed staff members that the agriculture ministry had not approved their 2019 budget, and staff members should thus prepare for any possible unfavourable events.

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