Board resignations gut Meatco
…Jooste demands clarity on abrupt exodus
RESPONDING to the sudden resignation of three Meatco board members since Friday, public enterprises minister Leon Jooste said he has requested for the “actual” reasons for their abrupt departure.
The resignations of Meat Corporation of Namibia (Meatco) board chairman Johnnie Hamman and fellow board member Kay Dieter Rumpf on Friday were followed on Sunday by a letter of departure by vice chairperson Clara Bohitile – just a year into their three-year terms at the national meat marketing and processing entity.
Jooste yesterday confirmed the unexpected exodus, saying: “Yes, I can confirm that they have resigned with immediate effect. I have written to each one of them to request that they provide the actual reasons that have led to them taking this drastic decision. I am waiting for this information and we will then consider and act in line with what we uncover to protect the interest of Meatco”. In a joint statement issued by the three board members, the directors said they resigned “due to material unreconciled differences with the management and the rest of the board of directors”.
Jooste appointed Meatco’s current board in May 2020.
Hamman and Bohitile were then unanimously elected as chairperson and vice chairperson of the board, respectively, and served in those positions until their unexpected resignations during the last few days.
Bohitile, a former parliamentarian, who farms with Brahman cattle in the Omaheke region, also served as chairperson of the audit and risk committee, while Rumpf also served as chairman of the Meatco UK board of directors, a subsidiary of Meatco, and served on the audit and risk and human resource committees.
Late yesterday, the Livestock Producers Organisation (LPO) said they are concerned about the resultant implications of the resignations and that recent events at the national export facility, Meatco, have impacted negatively on the overall confidence in the management’s ability to turn Meatco around.
In a statement sent to the media, they said: “The cattle industry is a key contributor to the total agricultural production in Namibia. This sector contributes on average about 45% to the total agricultural production value, making it by far the most important subsector. The value created has led to greater employment opportunities, the stabilisation and maintenance of rural economies, and thus the restriction of rural to urban migration.
“An unstable and unsustainable cattle industry will result in a loss of livelihood for especially rural individuals and a loss of disposable income for rural communities will, in turn, have a detrimental effect on the GDP. When contacted for comment, Meatco spokesperson Rosa HamukuajaTobias referred queries to Jooste, saying the resignations are a corporate governance issue that requires direct ministerial intervention.
New Era recently reported on Meatco’s financial woes as its CEO Mwilima Mushokabanji remained adamant the corporation is continuously working hard to reduce its debt as it adapts and responds to the prevailing business environment.
At the time, Mushokabanji was reacting to a report by independent analyst Rainer Ritter, which formed part of a ministerial investigation into the corporation’s operations. “One of the strategies we have addressed aggressively was the debt reduction strategy. At this stage, our longterm debt stands at N$382 million and we have worked hard at reducing this debt, which is mostly interest paid to banks, as our overdraft interest rates were very high,” said Mushokabanji.
The ministerial report allegedly stated the corporation could face liquidation if it does not become profitable in the near future.
However, the CEO is confident current debt could be reduced by 50%, which would assure stakeholders about Meatco’s continuing role in stabilising the national livestock industry.
According to Mushokabanji, the total agricultural contribution to the gross domestic product (GDP) in 2019 was N$6.8 billion in agriculture and forestry, of which Meatco contributed 26% or some N$1.7 billion. The Meatco CEO also stated that in 2017, the total contribution of the livestock industry to GDP was N$3.5 billion, of which 50% came from Meatco.
In May this year, Mushokabanji was confident that he, as a leader, and with a strong and enlightened professional board, as well as his dynamic management team of experts in the livestock sector, would no doubt assure Meatco would be transformed into an organisation optimally operating in a volatile, uncertain, complex and ambiguous world.