13 December 2012

Namibia: New Fishing Rights Holders Choose Chinese Partners

A NAMIBIAN fishing company has entered into a long-term joint venture with a Chinese fishing group which has already been accused by Namibian fishermen of subjecting them to poor working conditions.

The latest joint venture adds to reports of Chinese operators moving into the Namibian horse mackerel industry, displacing established players in the industry.

The China Fishery Group and Joka Two Fishing, a Namibian entity, are in the process of establishing a fishing company that will have quota holders as shareholders, says Kent Yeh, the director of corporate development and planning of the Pacific Andes Group.

The milestone deal is in the pipeline, the joint venture partners told The Namibian yesterday.

The Namibian earlier reported about allegations of poor working conditions on a China Fishery Group vessel that was catching fish on behalf of Namibian quota holders until September this year.

Pacific Andes Group, the holding company of China Fishery Group, however denied the allegations of poor working conditions on its trawler.

The workers claim that they were only fed two meals a day and had to be content with porridge, chicken and pork knuckles. Also there were allegedly no proper washing facilities, forcing them to wash themselves in small basins.

The Chinese company, now lining up to set up shop in Namibia, was also accused of not paying fishing commission to its crew, as is done on other vessels.

Yeh said yesterday that the joint venture with Joka would be a long-term one and a Namibian company would be set up for the partnership.

Joka Two Fishing is one of the newcomers in the fishing industry, and has been granted horse mackerel fishing rights for the next seven years.

Yeh said their next step would be to establish a Namibian company with a human resources department to hire full-time staff for their vessels.

“We do not wish to keep changing our workforce every season. I reiterate our respect for local labour laws and we will uphold them to the letter,” he said.

The group was accused of breaking the Namibian labour act by hiring its Namibian crew through a labour-hire company.

Yesterday, Yeh was very apologetic, saying that they only learned after having hired the workers that they had come from a labour-hire outfit.

According to him they needed to recruit at least 54 Namibians at short notice to begin their operations in Namibia earlier this year.

“As is the practice in other jurisdictions, we sought to engage the services of an employment agency which could give us the right amount of numbers speedily to enable us to start without delay. We were put in contact with a company that provided the sufficient human capacity for our vessel.”

He said they were alerted to the fact that they were dealing with a labour-hire company.

“With that knowledge, we engaged the labour-hire company and an understanding was reached that, for the duration of the agreement, the workers on Pacific Leader would be paid as per industry terms.”

Fishing commission is paid to fishermen when their catch is above a set mass.

“Unfortunately, some of the Namibian crew members leave for home immediately after docking and therefore do not get their share of the fish commission. This is not to say that China Fishery Group does not pay fish commission,” he defended the company.

China Fishery paid N$24 million to newcomers Hefdy Group to use its fishing quota for the year.

Hefdy Group consists of five individual companies that were allocated fishing rights in 2011. They are Human Capital Fishing, Egongelo Fishing Company, Fibresha Investment, Dorado Fishing Enterprises and Young Rangers Fishing.

It is alleged that Chinese companies fishing in Namibian waters pay exorbitant fees to quota holders and then try to recoup the expense by saving on labour costs. Other operators only pay about N$16 million for the same size of quota.

Established fishing companies such as Bidvest warned earlier this year that their profitability would be affected negatively because of a thinner cake that has to be shared between them and the newcomers in the horse mackerel fishing sector.

The addition of newcomers has allegedly resulted in the reduction of the quota per rights holder.

Although the total allowable catch for the species was not reduced, the 12 existing rights holders now share the cake with 10 more rights holders.

It appears that a number of new rights holders have entered into ventures with Chinese companies and have ditched their long-time partners.

The long-term impact of the Chinese entry on jobs on land and other ripple effects to the established industry has still not been assessed but is certainly going to have an effect.

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