Fishing industry gasping for air, says expert

A three-year battle with a weak US dollar, high fuel prices and declining catches have left many Namibian fishing companies on the verge of losing credit support from banks and facing closure, according to a financial expert. At the first public business meeting ever held on the fishing industry, bank manager Werner Thesen asked the Namibian government to intervene with a moratorium on quota levies and usage fees, to allow companies to overcome their cash-flow problems and reduce overhead costs. "Many of our fishing companies no longer qualify for ongoing credit support due to an eroded equity base, at levels that are no longer acceptable to banks," said Thesen, speaking on behalf of the Bankers' Association of Namibia. According to the banker, three Namibian fishing companies had shut down in the past few months, while "others are believed to be on the verge of a financial collapse". Around 14,000 people are employed in Namibia's fishing industry, which contributed about US $472.7 million to the country's Gross Domestic Product (GDP) in 2003. Fishing is the second largest business sector, after mining. Experts from the private sector noted that harbour charges, high maintenance costs and aging fishing fleets were also hampering the industry; too many concessionaries holding fish quotas fragmented the industry, and the playing field between bona fide Namibian companies and foreigners who owned Namibian companies, was not level. "Foreigners investing in Namibia's fisheries sector enjoy other benefits in the form of subsidies from their governments", Thesen commented. Managing Director Sylvanus Kathindi of Etale Fishing Company predicted that this year would be the "most difficult year for the fishing industry". Over 90 percent of the total catch was exported and sold in foreign currencies, said Kathindi, and currency conversion losses had accounted for a decline in income of at least $70.3 million. A larger proportion of smaller sized fish, the high volume of cheaper hake from South America on world markets, the depressed economy in Europe and the introduction of farmed fish species from East Asian countries were other factors influencing the industry, he pointed out. "Within the next few months the fishing industry, in close cooperation with all stakeholders, will have to take urgent measures to ensure the survival and profitability of the whole industry over the long term", Kathindi emphasised. But the ministry of fisheries said the situation was not as bleak as painted by the industry. In response to concerns raised at the business meeting, fisheries minister Abraham Iyambo said in a statement that he had advised the organisers against holding the public meeting, as the cabinet was still studying a report submitted by the fishing industry. He described Thesen's views as "unfortunate, premature and irresponsible". Catch figures and prices in the European markets had improved recently, according to Iyambo. "The current problems faced by the industry, mainly because of external forces, are temporary," said the minister, "... the Namibian fishing industry has a bright future and will continue to be a pillar of Namibia's economic development."