28 November 2008
Windhoek — The gains that have been achieved by the Namibia Stock Exchange-listed Namibia Breweries Ltd. may be reversed if government goes ahead with its plans to award a bottling licence to SAB Miller's front in the country, Castle Brewing Namibia.
Sven Thieme, executive chairman of the Ohlthaver and List, the mother company of Namibia Breweries, gave this warning this week.
"We are monitoring the situation," said Thieme when asked about the planned bottling plant by Castle. "We hope the government will be responsible enough to realise that Namibia Breweries play an important role in the economy. They should look at a bigger picture and not take actions that will jeopardise the operations of the company."
Thieme praised the government for having protected both Namibia Breweries and Namibia Dairies from competition for many years. But he said the gains achieved through this protection were now at risk with the Castle Brewing licence application.
A source in the Ministry of Trade and Industry told the Economist that SABMiller plans to build a bottling plant in the country and that around N$135 million would be invested.
According to the source, Castle Brewing Namibia will initially control 60% of the plant with 40% going to black investors. Castle Brewing has been trying to obtain a license for the past 10 years.
Castle Brewing Namibia MD Kobus Bruwer told the Economist that the company has been looking for the licence for a considerable long time.
"We have submitted our final application and the government is reviewing it," said Bruwer, adding that the company was waiting for a final decision by the government before announcing further plans.
"If we get the licence, the plant will be as centrally located as possible and close to the supply centres as possible," he said.
Bruwer said the plant will create 110 jobs and Castle Brewing plans to invest N$130 million, which is N$5 million lower than what the source in the ministry told the Economist.
"The reason why we want to set up a bottling plant is because it will be a win-win situation for the country and the company. At the moment our bottles can not be returned so this will also help the environment," said Bruwer.
He added that supply costs will also be reduced once the plant is set up and that Castle Brewing will be paying more tax both to the government and the local authority in which the plan will be situated.
"This also means more business for Namwater and NamPower," he said. "The plant will be on the supply side. We don't intend to create unfair competition. We just want to be adding value locally. We intend to bottle 80% of 750 mm beer in Namibia. We are excited about this."
Be the first to Write a Comment!
Copyright © 2008 Namibia Economist. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
