Government said it will require bidders to prove financial stability in their next round of fishing quota auctions in November after only managing to secure N$8.4 million from an initial N$627.9million worth of bids.
Finance Minister Iipumbu Shiimi said that even though most of the successful bidders of the auction, which took place last month, had requested for an extension to settle their dues, most of them did not keep their payment commitments as they were expected to settle their allocations by 2nd September 2020.
“In the future, punitive measures will be introduced including requirements for payment guarantees or bid securities before participation in the auction. This will ensure that bidders meet their financial commitments and mitigate the risk of speculative bids. In addition, more time will be given to bidders to arrange their finances. Further, bidders will be required to prove that they have access to fishing vessels,” said Shiimi.
He further added, “The Technical Committee has been directed to plan future Government Objective Fish Quota Auction(s) for the next season for Hake and Horse Mackerel, starting in November 2020 and January 2021, respectively, taking into account lessons learnt from this auction.”
Shiimi said the N$8.4 million will go to the state revenue fund.
“This will be part of the revenue that government is going to present to Parliament. When government budgets, when we look at government priorities, ministers will then submit the request government will then look at the priorities. And this money is then allocated according to the priorities,” he said.
This comes as government last month announced that it had raised N$627.9million by auctioning off its fishing quota, in a bid to secure maximum value of its fishing resources.
However, it has emerged that only 5 bidders managed to take up their offers and settled their payment obligations, thus the state only managed to auction off 100 metric tonnes out of 11 000 available for hake and only 1517 metric tonnes out of 72 000 for horse mackerel.
Those who have since managed to pay the state for right to access its fishing quotas are Eshisha Development and Rec ORG, Cambio Segrio Foreign Exchange (PTY) LTD, Bafix Baviro Trading Enterprises, Overburg Fishing Company Pty Ltd and Tunacor Fisheries.
The highest bidder among these is Cambio Segrio Foreign Exchange (PTY) LTD who paid the state N$3,120,000 for 800 metric tonnes of Horse Mackerel. The government also raised an additional N$76,000 from application fees.
International entities who participated in the auction accounted for 23 percent, while local participation accounted for 77 percent.
“Most of the players who participated in the auction are not necessarily existing players in the fishing industry. Most, if not all, do not own vessels. It also appears as if many fishing industry existing players that own vessels stayed away from the auction while those that participated, their bid prices were far lower than the reserved price,” Shiimi revealed.
According to the Minister, the new players to the fishing industry who took part in the auction claimed that they faced a number of challenges such as nonavailability of Namibian registered fishing vessels which was a condition of the auction.
“The position of the industry, through the Confederation of Namibian Fishing Associations, is that it is not in support of auctioning of the governmental objectives quota.”
The decision by government to auction off its quota, which was in the past given to Fishcor, was not received well by both public and the fishing industry, with Seaflower Pelargic Processing unsuccessfully taking government to court earlier this month over this decision.
Minister of Fisheries and Marine Resources, Albert Kawana said he will continue to engage the industry to bring them around on the decision.
“Even this weekend I will be in Erongo to engage them. First, they did not support the decision, because it’s the first time. But you have to engage them. Slowly, slowly they’re coming around.”
Meanwhile the Fisheries Minister also revealed that the much-anticipated announcement of the allocation of the commercial fishing quotas will be done before 1 November.
“I am going to inaugurate the new Marine Resources Advisory Council, which recommends to the Minister the total allowable catch total allowable catch (TAC). The advisory council is meeting tomorrow recommend the TAC. Once they submit their recommendation to the Minister, he recommends to cabinet, once cabinet approves, we’ll work around the clock to make sure all those quotas are given before 1 November. It will be done properly, unlike in the past, you know the difficulties I inherited.
Around 5000 companies and Namibians are believed to have applied for fishing quotas since 2018.