Construction
Set - Oct 2017 | Vol. 2 / No 4
NAMIBIA
The essential magazine for Namibia’s construction and mining industry
& Mining
Designing The Industry's Future
Maxx Solar Academy: A guide to sustainable energy solutions for your business THE SUNREF NAMIBIA PROGRAMME Rain water harvesting in Namibia
Construction & Mining Namibia, September - October 2017
N$10
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CREDITS Publisher Young Press Multimedia Editor Henry Masuku editor@constructionnam.com +264 81 599 5081 Business Developer Roxy Silta Tjarukua info@constructionnam.com +264 81 432 8467 Marketing Caryn Chanengeta marketing@constructionnam.com +264 81 2967087 Design and Layout Marcolino Justino designer@constructionnam.com Printers John Meinert Printers Physical address 24 Mozart Street, Windhoek West, Windhoek, Namibia
CONTENT 4
Maxx Solar Academy: A guide to...
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CIF and MANWU Disagree on future...
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Building for the future
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Big Things Start Small
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Field welding
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Strydom & Associates in impressive...
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Rain water harvesting in Namibia
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How to expediete the Roll-Out of...
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Call us for book cover placement Š2016 Young Press Multimedia cc. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of Young Press Multimedia cc.
As we continue to build a stronger partnership together, we fully recognize that your support and the continued trust that you place in us is the foundation of this magazine's success. Driven by a desire to promote the construction industry and help players in the sector keep up to date with developments and practical matters, Construction Namibia covers topics including contracts, cost management, procurement, construction law and regulations, communication and project management skills. The turn of the new millennium has set on course numerous routes for growth in the construction sector characterised by massive investment in green buildings, low cost housing, optimisation of power utilities and development of sound business. Construction magazine is driven by a strong editorial team with a vision to ensure expansion of clients business through reportage of significant events and developments in the world of construction including the newest methods of construction intended to improve efficiency, performance and reduce construction waste. Construction magazine is the largest construction magazine in Namibia edited exclusively to guide CEOs, owners of small-to-midsize companies, engineers, technological experts and policy makers to success. INTRODUCING THE CALL FOR EVENTS COLUMN Forward your construction related events with full details a month in advance. For those who wish to be added to our mailing list for a free soft copy of Construction Namibia please do not hesitate to drop me an email at info@constructionnam.com Construction & Mining Namibia, September - October 2017 2
Caryn
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E D I T O R ’4S- 6N O T October 2017 WITH MARKETING Protea Hotel Pelican Bay
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Contact Mercelyne Maletzky, 061 2072909 or mmaletzky@nust.na Construction & Mining Namibia, September - October 2017
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ENERGY
Maxx Solar Academy: A guide to sustainable energy solutions for your business
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enewable energies are one of the fastest economic sectors of Africa already and Namibia has the best conditions for solar energy in Africa. Combined with proper renewable energy policy that has been put in place by government, Namibia has the potential to achieve a 100% energy supply from local sources -with significant support by private SMEs. “Fossil fuel is on its way out, that’s for sure; it’s just a matter of time. So better be prepared for the inevitable that Renewable sources will take over, then just wait and see”, Dirk Bellens, Director of the MaxxSolar Academy Namibia is saying. Instead of waiting for the change to surprise the market, take action. Namibia’s entrepreneurs can turn the current development into their own success and enter the sustainable future proactively. There is great potential and the market conditions are set for success but companies need more than just a few panels and screws. Precise planning and design is the key for operating PV systems and to make a business sustainable as the green energy it is selling. To build up the Namibian solar market and support excellent quality installations by local entrepre-neurs, Dirk Bellens, also founder of Young Africa Namibia and Leonhard Eins, managing director of Solsquare Energy (PTY) Ltd decided to join forces with the Maxxsolar academy. Leonhard Eins: “There is a worldwide shift going on and the solar market in Namibia is one of the most promising. By supporting the Maxx Solar Academy we enable Namibians to access their full potential and learn the necessary relevant skills to find work in the solar industry.” Dirk adds: “Maxx-Solar Academy was one of the first training institutes for solar power in South Africa. Since 2011 they have trained more than 1500 participants in South Africa and now partnered up with four different partners to bring the academy to Namibia, Zambia, Zimbabwe and Lesotho as well.”
SuperSolarSchool The SuperSolarSchool is a one-week training which includes the three most demanded courses of the Maxx Solar Academy: • • •
Solar Power Sunrise Intermediate Course; Solar Power Technician Course; Solar Power Designer Course.
After 5 days of practical training SuperSolarSchool participants will be able to design, plan and quote for the installation of state-of the-art PV roof-top back-up systems and to install and operate them. This course also prepares candidates to undertake a Solar PV Assessment. The next SuperSolarSchool is from 6 until 10 November in Otjiwarongo and costs N$12.000,-. The Maxx-Solar Academy intends to ensure that the African solar market is built up by locally skilled solar experts. The courses are accredited by the German Solar Energy Society DGS (www.dgs.de) and are internationally recognised. All participants will receive a Certificate of participation which is jointly issued by the Maxx-Solar Academy and the German Solar Energy So-ciety DGS. A certification of completion is possible after passing an exam issued by DGS.
Join the Future! Super Solar School
All training in the Maxx-Solar Academy focuses on practical application. The participants do a lot of hands-on exercises and the trainers mostly work in the field themselves and can teach the participants real life cases. What differentiates Maxx-Solar Academy from other training providers is it’s broad alumni network. The training itself is independent, but if the participants want to get support with the founding of their own solar company, Maxx-Solar Energy (PTY) Ltd offers frequent alumni meetings, networking events and helps with the planning and design of first projects.
3 Courses in one week: Sunrise Intermediate Course, Technician Course, Designer back-up Course to prepare you for a business in solar! DGS Super Solar School, 6 - 10 November, Otjiwarongo, N$ 12.000,- pp Register on-line or send us an email!
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Construction & Mining Namibia, September - October 2017
maxx | Solar Academy | Tel. 064 202 280 | Mob. 081 620 30 95 Email: Namibia@maxx-energy-academy.org | Web: http://maxx-energy-academy.org/
INFRASTRUCTURE
MODERN RAILWAY TRACK (Part 4) MAINTENANCE REGIME
Modern railway track materials have been developed to serve for many years with minimal maintenance intervention and extreme reliability providing a basis for the development of predictive and preventive maintenance strategies.
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Regular maintenance of the railway track is vital for the safe running of trains
ailways have historically been known for its labour intensive practices and thereby a major provider of employment opportunities for the semi-skilled and unskilled labour groups. This was applicable to construction as well as maintenance activities on railway systems. The evolution of mechanized railway construction and maintenance technologies and modern day railway track components over the past 50-80 years, resulted in massive job losses in the railway sector. These were further amplified by losses in market share by railways who had to shed jobs as a means to survive economically in a very competitive and deregulated transport market. A total of 60% of jobs in the railway sector on the African continent were lost over the past 40 years. The traditional maintenance regimes were labour intensive and very much re-active with short term maintenance cycles. Maintenance units were stationed along the railway lines every 30 -50 km supported by daily foot patrol inspections, regular motor trolley inspections, footplate (on locomotive) inspections by track maintenance engineers/ inspectors and defect reporting by trains. All defects were visually identified on which work programs were based. Hand operated tools were predominantly used to repair defects. As referred to in the previous editions of this series, modern railway track standards had to cater for faster, longer, heavier, on-time trains and railway operators had to become more responsive to the needs of the market and become financially sustainable. Therefore the need for a more cost-effective maintenance
regime delivering a more reliable railway track system.
computer capacity to automatically correct track geometry during the tamping cycle.
Modern railway track materials have been developed to serve for many years with minimal maintenance intervention and extreme reliability providing a basis for the development of predictive and preventive maintenance strategies. Maintenance cycles could also be extended in accordance with the traffic volumes on each route thereby optimising maintenance costs in line with the revenues generated.
Modern day railway maintenance regimes are continuously striving towards reducing maintenance costs, prevent service failures, reduce track down time and increase productivity of the work force.
Modern day diagnostic tools such as the electronic track measuring cars (ie Plasser EMV 80) measuring track geometry at normal train speeds, ultrasonic on-track cars to detect internal rail defects and devices to measure rail stresses in track are applied by railways in its condition monitoring programs and rolling out of preventative maintenance programs. Traditional inspection methods and manual observations still form part of the process.
Acknowledgements: International Railway Journal, May 2017 Compiled by: Jack Dempsey, Contract Manager. D&M Rail
As referred to above, railways had to apply mechanized maintenance methods due to the demands of modern day track with strict tolerances and for economic reasons. The most common mechanized maintenance machines are the on-track ballast tamping, on-track ballast regulating, on-track ballast cleaning and on-track rail re-profiling machines. The ballast tamping machine is in regular use in Namibia for track maintenance tamping with the others applied on an ad-hoc basis as required. Modern day ballast tamping machines are highly sophisticated equipment with electronic track measuring abilities and on-board
In the next edition (the last in this series) we will look at the latest developments in the “instituting of predictive and preventative maintenance regimes “
The railway track is being maintained by manual labour using hand tools
The railway track is regularly inspected by a rail inspection trolley or by doing foot patrols.
Construction & Mining Namibia, September - October 2017
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NEWS
CIF AND MANWU DISAGREE ON FUTURE MINIMUM WAGE INCREASE Negotiations to determine the increase of minimum wages and minimum employment conditions for the Namibian construction sector have reached a deadlock. In response to demands received from the Metal and Allied Namibian Workers Union (MANWU), the Construction Industries Federation of Namibia (CIF) had engaged its members to receive a mandate to determine the future minimum wage increase and future minimum employment conditions for selected job categories in the construction sector. As from 1 January 2017, the gazetted minimum wage in the construction sector is N$16.04 per hour, which is the result of two big increases of 10% each, of the minimum wage of N$13.26 in 2014/2015, and the minimum wage of N$14.59 in 2016, respectively.
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ANWU demands a minimum wage increase of 13% for 2017/2018 and a further increase of 13% for 2018/2019. In addition, demands listed by the union include an increase of minimum employment conditions, which – if agreed – would be new additions to the Collective Agreement, and would have serious cost implications for the employer. The total of MANWU’s initial demands constituted an increase of over 70%. These demands included inter alia: a housing allowance, a meal allowance, a transport allowance, an extension of the statutory maternity leave of 12 weeks to 14 weeks for the industry and negotiating with Nam-mic for loans for employees. With regard to the minimum wage increase, the CIF, representing employers in the construction sector, feels it would be irresponsible to increase the minimum wages during the current economic downturn, in particular as the construction sector is hit the hardest and the entire supply chain is experiencing large-scale retrenchments, and as it is not clear when the economy and specifically the construction sector will revive. Bärbel Kirchner, consulting general manager of the CIF explained: “According to research conducted by the CIF in June 2017, 47% of employees in the industry have lost their jobs. The situation is likely to have worsened since then. Yet, despite large-scale retrenchments since September 2016, the CIF, for now, very reluctantly made an offer of an increase of 2.5% of the minimum wage, in response to the outrageous demands of the 13% by MANWU and their very extensive list of demands. “In fact, since we have commenced with the negotiations, the situation has worsened. We started negotiating in April 2017 when we had made an offer of minimum wage increase of 2.5% for when a new agreement would be 6
promulgated. The situation is far less hopeful now than it was in April, however in order to honour what already had been agreed and in order to keep negotiating in good faith, we have not retracted that offer. Moreover, it is important to note, any increase would only become relevant once a Collective Agreement would be promulgated in the government gazette. The industry is also adamant that any agreed increase would not be back-dated. “We are very disappointed that our industry, in addition, is now also facing such demands from MANWU, who is representing workers in the industry. “Revenues in the industry are extremely low, if not non-existent. Many employers keep their teams employed with the hope of work and projects in the near future. If minimum wages were to increase even further, then many will not be able to continue keeping members of their teams employed. It can have devastating effects, especially if you think, that eight dependents will be affected for every job that will be lost. Many SME’s in our sector will also be badly affected.
“It simply must be in everybody’s interest to keep as many people employed and not to hike up the increase of only a few remaining employees. We must remember, what we are negotiating is the minimum wage increase for the respective categories for semiskilled and artisans for the entire industry. If we are to concede to the demands of MANWU, it is likely that many workers will lose their jobs”.
Construction & Mining Namibia, September - October 2017
Under current economic conditions, the CIF feels it is more realistic to agree to demands that are for the larger construction businesses a matter-of-course, such as provision of drinking water and separate toilets for male and female employees, and the promotion of health and safety education for employees. Other demands of the union further included an extension of shop steward days from currently seven to a total of 10 days, an increase of pension fund contributions, an increase in Service Allowance and increase in the Living Away Allowance. MANWU’s original proposal/demands were presented on 15 April 2016. However, in 2016, the CIF had on several occasions raised their concern with MANWU about the timing of their proposal to negotiate for construction wage and substantive proposal increments, in particular as it was soon after the implementation date of the previously negotiated and gazetted two-year collective agreement (gazetted on 31 December 2015). Negotiations had commenced in April 2017, after the CIF had sought a mandate from its members. Meetings were held on the following days: 7 April 2017, 21 April 2017, and on 9 June 2017. As the two parties were not able to move forward, MANWU had declared a dispute of interest. After two conciliation meetings at the Labour Commissioner’s Office, on Tuesday, 5 September 2017 and on 15 September 2017, a certificate of an unresolved dispute was issued. The next step will now be that the CIF and MANWU will meet on 22 September 2017 to negotiate strike or lockout rules in accordance with the Labour Act, 2007; the Code on Good Practice on Industrial Action, 2009; and the Code of Good Practice on Picketing, 2009; which then will guide both parties with regard to further action.
ARCHITECTURE
Building for the future
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he design intent was to create a dynamic, efficient building which reflects the scientific nature of the work of the NIP and the progressive nature of the corporate culture. This led to a building which is angled off the from the city grid and the site boundaries, the expressed edges of the facade which forms a continuous line from floor to walls. The off-set geometry is countered by the main entrance atrium and lifts being on the city grid with a resulting tension between the two geometries which enlivens the atrium space. The interior finishes and colours were chosen to reflect the scientific and progressive nature of the NIP both in terms of work and in terms of corporate culture. As a counter point to the
neutral palette, bright colours were chosen for elements (office chairs, meeting room carpets, tea kitchens) and these colour-coded per floor. Tall glazed facades on the north face allows maximum light into the interior and captures the sun during the cold winter months, thus reducing the amount of mechanical heating required. In the hot summer months the glazed north facade is in the shade and the high summer sun will be mostly on the roof and south facade which has only horizontal strip windows to reduce the heat gain. Insulated glazing units (double glazing) are installed in the east and west facing facades to reduce the heat gain and all windows have solar shading glass.
Photographer - Arthur Peuckert Construction & Mining Namibia, September - October 2017
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ENTREPRENEURSHIP
Big Things Start Small - The Jefta and Taimi Haggai story time, meeting dealings with suppliers and service providers, is important”, says Haggai. Rhetorically he asks, “How can I expect the bank to support me in time of need when I don’t even bother to keep my account in good order?” Haggai underscores the importance of cultivating a savings culture. “Imagine if I didn’t then I will now be squealing like many others today”, adding “Don’t save what is left after spending, but spend what is left after saving”. Jefta and Taimi Haggai are certainly a couple going places. They are the hidden business icons to be found in Namibia’s smaller urban centres, those local entrepreneurs who are the backbone of the local economy of smaller towns across the country, collectively creating the country’s wealth and thousands of jobs. Jefta Haggai with building construction equipment
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amibian business leaders like Aupa Frans Indongo and the late Harold Pupkewitz are revered for their achievements in their respective industries. However, the significant contribution towards economic development made locally by entrepreneurs in smaller towns around the country, often goes unrecognized.
Take for example, Otjiwarongo-based Jefta Haggai and his wife, Taimi. They started from the proverbial kitchen table yet today their business, Omagumbo Construction, is one of the foremost in that part of Namibia. After completion of his building construction training at the Vocational Training Centre (VTC) in Okakarara, Jefta started as a general worker on a building construction site. “I only worked for that firm for a few months before starting my own business”, says Haggai. “I knew I could do much better being my own boss because I was hard working and dedicated”. Haggai registered the business a mere 10 years ago in 2007, after the first quote he ever prepared on his own was accepted by a customer. Haggai had no equipment, but the understanding customer took a risk and agreed to pay an upfront deposit before the job even started. With that money Haggai bought a cement mixer, wheelbarrows and other tools. This represented his first ever investment and since that day Haggai makes a point of always reinvesting a portion of money generated from each job. 8
Haggai fondly recalls the day he opened the business’s first bank account at the FNB Otjiwarongo branch. The bank official was initially skeptical, but when Haggai asked if he could make his first deposit of N$100 she realized this budding entrepreneur was set to go places. Since that day he has enjoyed a mutually beneficial relationship with the Namibian Stock Exchange (NSX) listed bank and the relationship has grown from strength-tostrength. “Resultantly whenever a performance guarantee is required in support of a tender bid”, Haggai confidently says, “I know my personal banker is just a phone call away”. Fast forward the clock ten years and today Jefta and Taimi Haggai are shareholders of many NSX listed companies, including the bank. Revonia Kahivere, FNB Manager for Corporate Social Investment expressed her delight with this success story: “We have been supporting SME Compete for many years and success stories such as these warm our hearts. At FNB we understand the important role SMEs toward the economic transformation of our country. We support budding SME’s that in turn will employ our fellow Namibians and contribute towards the growth of the country.”
The business founded and owned by Jefta and Taimi Haggai, Omagumbo Construction, continues to benefit from routine business growth support and mentorship services provided by SMEs Compete. A social entreprpeurship entity, SMEs Compete is supported by First National Bank through the FNB Foundation Trust to provide mentorship, business skills development, wealth and job creation support to entrepreneurs across Namibia. The FNB Foundation Trust is funded by the NSX listed banking and financial services group, FNB Namibia Limited. Programmes and projects all over the country are supported by FNB Foundation with education and economic development important focal areas.
Jefta Haggai - on building site
Asked to share his recipe for business success, Haggai says it all about relationships. “Firstly, with my wife, Taimi who works alongside me on the construction-site and helps with the paperwork to make sure our books and administration is up to date,” says Haggai. “Demonstrating honesty, reliability and doing what you promise to do on time every
Construction & Mining Namibia, September - October 2017
Jefta & Taimi Haggai - Omagumbo Construction
PROFILE
Beware of accepting risk of loss through final completion
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he construction industry has been a topic of conversation for almost a year in Namibia. “They have endured hard times over the past year, due to water restrictions, non-payments and cancellations of contracts during these tough times,” says Seun Kesslau, National Head Commercial Department, FNB Insurance Brokers. To ensure that they do not suffer more losses, FNB Insurance wishes to emphasise, that builders and construction companies should remain aware of the risks of losses inherent in their industry. “The big companies know what to be aware of and what documents to sign, but often the smaller companies are not necessarily aware of all the loopholes, and they might end up having to pay penalties or other unexpected expenses which has an impact on the profit of the job and ultimately their bottom line.” Builders risk insurance is the primary source of funding for losses that happen
during construction, but contractors may inadvertently put themselves at risk for uninsured losses by overlooking a disconnect between the contract language and the insurance policy. Seun advises that builders risk insurance policies typically provide, that coverage remains in force until a stipulated event takes place, such as substantial completion, final payment or when the project is “put to its intended use.” He adds: “The construction contract, however, stipulates when the contractor’s “risk of loss” for damage to the project terminates. Contractors must be careful not to accept contract language that extends their risk of loss beyond the termination of the builders’ risk insurance. For example, “final completion” is likely to be construed (or even defined in the contract) much differently than “substantial completion.”
Disputes or discrepancies can delay “final completion” of the project for months or, in extreme cases, years. If the builders risk insurance terminates before “final completion,” the contractor could be exposed to losses that occur after all work on the project is completed—and even after the owner takes possession and begins operations at the new property—without any insurance to cover that risk. To avoid this outcome, contractors must negotiate contract language that matches the risk of loss to the builders’ risk policy’s termination of coverage provision. “We welcome anybody to contact us for more information and expert advice to ensure that during these tough times, unnecessary risk is avoided,” emphasizes Seun.
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September - October 2017
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INFRASTRUCTURE
FIELD WELDING
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very important aspect of railway maintenance is the corrective welding of a rail in the track and as the rail cannot be dismantled and taken to a workshop, it has to be welded where it is. Defects on the rail is caused by thousands of train wheels going over a certain section of rail over time and this needs to be corrected to ensure no further deterioration and shortened lifespan of the rail. One example of field welding is the building up of wheel spin damage to the rail caused by locomotives which do not get enough traction and start spinning. (See photo 1) If a wheel spin defect is not attended to timeously it can cause concrete sleepers to crack or the geometry of that section of rail can be affected negatively. A wheel spin defect is repaired by welding new material on the surface of the rail crown in layers and then grinded off to form a smooth rail again. Since D&M Rail Construction has started with the Rehabilitation and Upgrading of the railway line between Kranzberg and Tsumeb, 9 345 wheel spin defects have been repaired. Another type of Corrective Field welding and grinding is the building up of battered or mismatched rail joints which are caused by a deep joint in the horizontal alignment at the rail joint and the train wheels hammering the rail ends when moving over it. Apart from welding new material on the rail at the joints and the grinding thereof, the sleepers need to be tamped to give more support of the rail
Photograph 4 over the joint. 11 228 of these type of defects have been completed since the beginning of the project. The third type of defect one find on a rail is rail crown damage which is also corrected by welding and grinding while the rail is in the track. These defects are caused by flaws and wear over the years in the metal of the rail. Pitting and flaking of rails also occur over time and D&M have repaired 18 480 of rail crown damage defects. (See photo 2) Thus almost 40 000 rail field welding and grinding defects were completed and imagine how many welding rods and grinding stones were used over the past few years. The modern way of building railway lines is to have a continuous welded rail which means the joints are eliminated and the rails are welded together over hundreds of kilometres. The rails are welded together by means of a thermit process which is powdered metal which get ignited under specific conditions
Photograph 2 10
Construction & Mining Namibia, September - October 2017
and molted steel connect the two rails. (See photo 3) The excess material of the weld is then grinded off to form a smooth rail with none of the well-known click-clack sound of train wheels going over a section of railway line. (See photo 4) D&M Rail construction has poured 15 276 of these welds and have thus eliminated 15 276 rail joints which is often the main cause of defects in the railway line and can cause derailments. Compiled by: Leon Steyn, Site Manager D&M Rail
Photograph 1
Photograph 3
ENVIRONMENTT
FNB @Parkside Building now 5 Star Green Star
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he FNB head office @Parkside in Windhoek has officially received a 5 Star Green Star Africa As Built rating from the Green Building Council South Africa (GBCSA). This is the only As Built project (i.e. construction completed, operational, new building) in Africa, outside of South Africa, and the first 5 Star rating in Namibia, and Africa outside of SA.
Sarel van Zyl, CEO of FNB Namibia Holdings: “Our building is the first As Built rated building outside of South Africa, as well as the first 5 Star rating outside of South Africa. We are immensely proud of this achievement and once again thank all involved parties who have made this possible. This is a great achievement and a testament to hard work by the construction and operational team.” The 5 Star Green Star SA Certified Rating recognises “South African Excellence” and carries a weighted score of between 60 and 74. The project achieved 55 points in its Design rating in 2014/2015, which is a comfortable 4 Star Rating. The threshold for a 4 Star Rating is 45 points, and as FNB achieved an excess of 10 points, A 5 Star rating requires 60 points to be certified. The project achieved 64 points for its final As Built rating.
FNB Namibia Holdings worked closely with WSP Building Services, Africa to identify further opportunities to increase the point value for a comfortable 5 Star rating of 64 points. The project includes the following innovation aspects that contributed to the 5 Star Rating: • •
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Community Accessible bicycle racks, for use by building visitors and community members for nearby amenities Significant energy savings as each light fitting in the office area is fitted with an occupancy sensor, this initiative reduces energy consumption on the building which is a substantial environmental benefit as less energy is wasted through active lights in areas where there are no occupants As part of the project development, community traders’ stalls and
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amenities have been installed on the active street network along Independence avenue FNB has implemented a Waste and Recycling Management Plan, that addresses operational waste production, suitable storage and how operational waste is diverted from landfill for the life of the building Inclusion of an access flooring system that contains recycled content, and can be fully recycled after use.
Gregory Rice, Green Star SA Accredited Professional Sustainability Consultant (Associate) explains: “The Green Star SA rating tools consist of eight environmental categories (and a ninth for Innovation) which include: Management, Indoor Environmental Quality, Energy, Transport, Water, Materials, Land Use and Ecology, and Emissions. These categories are subdivided into credits which address an initiative that aims at improving environmental performance for the building. Points are awarded to the design or building (as “Design” or “As built” certifications are allowed for) according to the categories and after appropriate environmental weighting, a calculated score is assigned to the design or building. This score is then converted into a Green Star SA rating.” There are two types of ratings that can be applied for: “Design” or “As built”. The Design rating is a certification of the project’s sustainable design, prior to construction. The reason for this certification is so that the building can be marketed as Green Star SA certified to attract tenants, investors and/or buyers. Once the building is constructed, an “As built” certification can be applied for. In both instances, the certified rating must be achieved no later than 24 months after Practical Completion of the building. The As Built rating is based on actual building design, system operation and comprehensive commissioning to optimize the operations of the installed systems. The contractor carried out commissioning in accordance with CIBSE (Chartered Institute of Building Services Engineers) requirements. This detailed process ensures that the systems have been tested comprehensively, and have been optimized to operate at peak performance.
Construction & Mining Namibia, September - October 2017
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THE SUNREF NAMIBIA PROGRAMME SUSTAINABLE UTILIZATION OF NATURAL RESOURCES AND ENERGY FINANCING (SUNREF) PROGRAMME SUNREF (Sustainable Use of Natural Resources and Energy Finance) provides solutions for the new and clean energy and environmental transitions by helping private actors in the developing countries, particularly south of the Sahara, to seize its opportunities and encouraging local financial institutions to finance it.
SUNREF, AFD’s green finance label • In articulation with local public policies • Targeted support to develop innovative green investments
A customized approach • SUNREF range of services is tailored to allow companies to acquire higher quality equipment, make cost savings and be more competitive • Loans allocated by local partner banks • Investment premiums • Free technical assistance depending on the geographical area • SUNREF also offers banks special partnership conditions to allow them to seize the opportunities of green finance
SUNREF: An innovative partnership for Green finance Integrated approach Innovation: combination of a financial approach & technical approach. Objective: to meet the demand of partner banks and project initiators.
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Construction & Mining Namibia, September - October 2017
Grant
Stimulate Demand
Technical assistance + capacity building
Loan/Guarantee
Partner banks
Stimulate Supply
Loan agreement
Companies Technical Assistance for the bank’s potential clients financing of energy or material audit, support for project design, monitoring of implementation…
Financial incentives for “green investment via financing at attractive rates…
Financial approach • Provide local partner banks with long-term loans (green credit lines). Favorable terms on the basis of certain criteria (maturity of green financing market, type of investment, target client base)
Technical approach Support and scale up the market for green investment financing • By assisting banks in project financing • And building the capacities of companies to implement strategies for an optimized use of energy and natural resources WHAT PROJECTS ARE ELIGIBLE FOR THE (SUNREF) Programme Renewable energy
•
Renewable energy RETROFITS and energy efficiency programmes
Sustainable tourism
• •
Eco-Tourism development Concessional loan financing for tourism concessions in protected areas
Sustainable agriculture
• •
Conservation agriculture programmes Value addition on natural resources and agribusiness
For more information and application procedures: Environmental Investment Fund of Namibia 2nd Floor, Capital Centre, Levinson Arcade Independence Avenue Call us at Tel: +264 284 2701 Email us at info@eifnamibia.com Visit our website at www.eifnamibia.com Like us on Facebook Follow us on Twitter
Construction & Mining Namibia, September - October 2017
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SURVEYING
Strydom & Associates in impressive South African border Survey
Typical Swaziland mountain terrain
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he South African government has embarked on a project to improve their border security to stop the influx of illegal immigrants. Part of the project is to improve on the border fences and the patrol road of these fences. Therefore a tender was awarded for a multi discipline team the provide the necessary services to improve the present border security.
As a base for all design proposals an accurate mapping and detail survey was necessary for all professionals to base their design proposals on. Strydom & Associates Land surveyors were awarded the survey control portion for the Swaziland/Mozambique border form Ponta De Ouro in the east along the Swaziland border and back to Mozambique up to Mbuzini , just south of Komatipoort. The total distance of the control survey was 540km and we were requested to establish a photo ground control (PGC) point every 5km along this boundary.
mountain terrain. Next we moved base camp close to the town of Barberton for the last stretch to the Mozambique border. For maximum survey speed the team was operating in 3 survey vehicles with a fourth vehicle as logistical support. Between the 3 teams 15 Leica SR530 dual frequency geodetic GPS receivers were utilized to survey both Trigonometrical control beacons and PGC points. Finally the survey was completed on the 21st
A total of 25 metrical control beacons were occupied and a further 105 PGC points constructed and surveyed. Our survey started with departure from Windhoek on the 9th of May , arriving at base camp the next evening and starting the survey on the 11th May. The survey went fast along the Mozambique border, circumventing the Ndumo Elephant Reserve and soon we arrived at the Swaziland boundary. We had another easy stretch down to the Jozini dam but then the weather turned nasty we experienced three very wet days , the muddy terrain slowded down our progress dramatically. We moved base camp close to the town of Piet Retief and finished the stretch up to the very mountainous border section. Next to do was this extreme mountain section of 70km. The only way to navigate this section was by foot, horseback or helicopter. We opted for the helicopter option and this section was completed most enjoyably with some very scenic views in the beautiful Swaziland 14
Project area
Construction & Mining Namibia, September - October 2017
of May and the 4 man team arriving safely back in Windhoek on the 24th. After the survey the next step was the calculation of the observed GPS vectors. The 10 days of observations was uploaded and the processing went without any problems. Only in the final calculation were the GPS network has to be constrained on the existing Geodetic control did we experience some problems. The Trigonometrical beacons of South Africa is surveyed to a very high standard if you appreciate how these beacons were established
. A great number of surveyors from “Trig Survey” based in Mowbray , Cape Town has spend thousand of hours over the last century to built and survey these beacons. This was done in the pre-GPS era with a mixture of equipment ranging form the old Tellurometers using sound waves to determine distances and Theodolites to observe horizontal and vertical angles between these beacons. The equipment accuracy together with the calculation restrictions, such as trying to apply a least square use of 8 figure tables just does not compare to the present day ability of network adjustment of GPS surveys. This resulted in the final fit of the GPS network showing some large residuals when compared with existing control points. Fortunately there was a solution. South Africa boast a very impressive continuous operating GPS network know as TrigNet. This allows a user free of charges to download GPS observations data from 1 hour data sets up to 24h data sets.
Trigonometrical control beacon
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Making use of the excellent public service, GPS data for station points were downloaded for the duration of the survey campaign and used to recalculate the GPS network in relation to this very high accuracy control network. Constraining our GPS network this time round was a perfect fit , with an accuracy of better than 20mm overal.
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Getting ready for helicopter visit to survey beacons
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Trigonometical beacon – Ponta De Ouro overlooking the Kosi bay nature reserve
Winner PMR Golden & Diamond Awards
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Tel: +264-(0)61-233693 • infowhk@whssnamibia.com • 5 Nickel Street • Prosperita • Windhoek Tel: +264-(0)64-462020 • infoswakop@whssnamibia.com • 36 Hidipo Hamutenya St. • Swakopmund 15 Construction & Mining Namibia, September Tel: +264-(0)65-226212 • info-oshakati@whssnamibia.com • Main- October Road • 2017 Oshakati
EDUCATION
Persistence And Quality
B
orn in Cape Town in 1957, Leon Steyn grew up in Nelspruit and Boksburg, South Africa. After his matriculation in 1974, he had to undergo compulsory military training after which he enrolled for a four year National Diploma for Technicians (Civil) at the Pretoria Technicon. Steyn completed his studies in 1979 and moved to Windhoek to start his career at the then South African Transport Services as an Engineering Assistant.
Namibia was at that time on the brink of Independence and all employees were given a choice to go back to South Africa, but Steyn decided to stay on at the new Railway Company in Namibia, the National Transport Corporation in 1988. After independence, the company’s name changed to TransNamib and Steyn was deployed in various positions during the following 15 years in different departments. He completed a National Diploma in Transport economics through the Rand Afrikaans University during this period. Steyn later left TransNamib in 2003 to pursue the private sector in the road transport and
tourism fields, only to be called back to his favourite industry; namely railways. In 2012 he was appointed the Site Manager for the rehabilitation and upgrading of the Kranzberg to Tsumeb railway line based in Otjiwarongo for D&M Rail Construction.
Steyn says “To manage a team of 500 Namibians varying from professionals, to skilled and semi-skilled employees requires a well structured human resource component to ensure enough supervision and controls for a successful operation.
on site, including the support of vehicles and equipment. This project is a very satisfying challenge for Steyn and he strongly believes that through training and development of people, D&M Rail Construction will be well placed in the Namibian construction industry to maintain and build the Country’s rail infrastructure for many years to come.” Steyn concludes.
One has to make provision within the company to allow personal development of employees and to empower people to encourage them to excel. Anybody but a team player will not survive the challenges in this position due to the diversity of the group who, in addition to the vast differences, was not working in the same area but over hundreds of kilometres from each other.” “Railway construction requires good planning relating to manpower and material availability
LEON STEYN, SITE MANAGER, D&M RAIL CONSTRUCTION, OTJIWARONGO
INTERNATIONAL ACCREDITATION FOR ARCHITECTURE PROGRAMMES
T
he NUST Department of Architecture and Spatial Planning (DASP) has once again been granted unconditional validation status for its Bachelor of Architecture and Bachelor of Architecture Honours programmes. The said Department offers programmes in Architecture, Quantity Surveying, Town and Regional Planning, and Regional and Rural Development. The validation stems from an assessment done by the South African Council for the Architectural Profession (SACAP) and the Commonwealth Association of Architects (CAA).
One of the benefits of this validation is that SACAP and CAA will be able to endorse the NUST architecture qualifications and recommend them to a variety of international validation authorities, thus attracting the best staff and students beyond Namibia’s borders. The status will also enhance the Department’s efforts to become the first choice in achitectural studies in the SADC region.
further studies and professional registration at the appropriate qualification level,” Prof Umenne remarked. The Vice-Chancellor, Dr Tjama Tjivikua, congratulated the Department and also expressed his gratitude to SACAP and CAA for their professional conduct. This validation status is due for review in 2021 for SACAP, and in 2022 for CAA.
“Furthermore, this achievement will increase the mobility of our students and graduates for
A delegation from the two institutions visited NUST recently to assess the two programmes, with regards to the quality and relevance of the architectural qualifications leading to professional registration and practice. “This exceptional landmark achievement by the NUST Architectural Learning Site, which was established less than seven years ago, has come barely 13 months since the two architecture programmes received the unconditional validation status of the Namibia Council for Architects and Quantity Surveyors,” said Prof Sampson Umenne, the Head of the DASP. 16
SEATED: Prof Sampson Umenne, Head: Department of Architecture and Spatial Planning; Deborah Preller, Secretary: SACAP Validation Board; Dr Tjama Tjivikua, Vice-Chancellor: NUST; Prof Arthur Barker, Board Chair: SACAP Validation Board, and Laurie Ferron: CAA Representative (standing, second from left), pictured with other delegates.
Construction & Mining Namibia, September - October 2017
CONTRIBUTION
PAINT IT BLACK “I want to see it painted, painted black Black as night, black as coal I want to see the sun blotted out from the sky I want to see it painted, painted, painted, painted black ...”
-The Rolling Stones
W
hat is behind the worldwide trend to paint buildings black? The colour black has been used in arts and architecture from the earliest times. Since the establishment of Modernism, Bauhaus and De Stijl during the 1920's, the use of black became quite popular in architecture. Black was used to accompany white surfaces of building walls on smaller elements like window frames, balustrades and structural beams. The significance of black in architecture increased again during the 1980's (High-Tech Style), through the 1990's (use of achromatic colours to portray minimalism), and has become the colour of the current era (creation, power, money). The only difference is that nowadays black has taken the place of white as the main colour, covering large surfaces of Avant-garde Architecture on its own. In using black, architects can achieve the effect of a sculpture-like appearance for their buildings. The reason for this is that black, like no other colour, intensifies the graphic effect a building has. Its darkness creates a perception of weight and seriousness, giving it visual strength. For it to be a success, the architecture needs to be of a simple, striking form without much detail, and with the focus on the functionality of the building. This results in a pure and elegant building with dignity and authority, drawing all attention to it. Not melting into its environment, it would thus isolate and distance itself from it, proclaiming: “Here I am, take a look at me - take me or leave me.” In this manner, it could even give the impression of inaccessibility. Absorbing all energies around it, uncompromising black can become very powerful and its intense energy quite intimidating, even making it unapproachable. The answer to the question, why this controversial 'colour' is trending at all, is that black is the favourite element to use during periods of extreme change and trauma. In the scientific world black, white and grey are
COLOUR ANALYST
SPACE EVALUATION
PAINT CONTRACTOR
called “non-colours”, because they do not contain any colour pigments as such, therefore representing the extreme. With terrorism and the refugee crisis not being under control, with the huge gap between rich and poor all over the world, there are major social issues and unrest at present, like in the 1970s. People are forced to deal with their insecurities, but still want to live a peaceful life while having fun; they want to express themselves in a bold and daring manner to counterbalance the stress. This clash between extreme opposites, a sure sign of our times, is a huge aesthetic preference in the design- and architectural world, and will continue for the years to come. It manifests itself in the use of contrasting materials and colours, especially dark and light, with the biggest possible contrast reached in the combination of black (absorption of all light) and white (reflection of all light). In sticking to a black and white colour scheme, one emphasizes the crisis situation the world is in, reminding viewers of it all the time. However, that is only one side of life. Life actually happens within all the colour nuances of the rainbow between black (the end) and white (the beginning). In adding a bit of colour, even if the contrast between light and dark is still used, one can obtain a shift in the thought pattern and general wellbeing of people. In this manner it would aid the process of dealing with the current situation and finding a way out of it faster. Especially in Namibia we should consider that natural colours blend in more with the African landscape, making a building more user-friendly and acceptable to the public. One should ask yourself, whether it is at all wise to follow the trend towards black in a country like ours? The striking effect of a black building could be visually pleasing, but if it does not trigger something in the viewer he or she can relate to on a positive level, something is very wrong and not in harmony with human nature. As the absence of all light, and therefore the
WALLPAPER & FRESCO
TRAPPIES HOLZE B. ARCH DIPL.PAD
.
absence of all colour, black is darkness at its maximum level. The resulting effect black has can be funereal, reminding people on a sub-conscious level of certain unwanted situations, like death, depression, darkness, etc. On a physical level one should take into consideration that black colours absorb 70% to 90% of the radiant energy from the sun that strikes the surface, because it does not reflect any infrared rays. A dark building therefore heats up much more than one kept in light colours, requiring more precious, expensive energy to keep it cool inside. In overseas countries they have developed special paint products with metal oxides in them for dark colours. The metal oxides reflect most of the infrared rays from the sun, resulting in a cooler building atmosphere. Especially in a warm country like Namibia, such products would help in making black 'green', should the use of darker colours on buildings continue. Black is a controversial colour with many, often ambivalent meanings (too many to name here). That it has a strong effect on people, whether positive or negative, is certain. However, the final effect any colour has will always depend on the intensity of the colour, the size of the surface it is used on, the surrounding reflections and the function it is to portray. The context a colour is used in is the main factor, determining whether the use of a certain colour and/or colour combination is a success on both a physical and psychological level. Although architects, designers, as a matter of fact all of us, are prisoners of the Zeitgeist on a sub-conscious level, we should be very conscious when designing with black. Especially where the public is involved, more of the trending colours could be used in combination with black to soften its effect and make it more agreeable with human nature. Perhaps then, black magic can do its thing!
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17
WATER
Rain water harvesting in Namibia – a possibility Water is life1 . About 70 percent of the Earth's surface is covered by water, and the oceans hold about 97 percent of all the water on Earth. People, animals and plants all need water to live and without water, Earth in all likelihood would be a dead planet. Water is an ever-present need and the constantly increasing population will then increase the demand for water. With the availability of water remaining finite, will there be enough fresh water available for all of us in the future? Underground
Above ground
Figure 1 images extracted from rainwater harvesting diagram in bermuda
USE OF WATER World-wide, all of the water we use comes from surface sources such as lakes, rivers, streams or underground aquifers, and at times we also utilise sea water via desalination and rain water based on direct need or depending on one’s country or city water management system. In households, water is used for various reasons such as drinking, cooking, watering gardens along with other domestic activities. Dr. T. Uhlendahl et al. (2010) reported that “the City of Windhoek [CoW], based on its own data, estimates the annual water demand at 22.6 Million m³ per year. This figure includes water demand of the whole city, including industries and the central business district. The calculated water demand per capita per day based on data of CoW is about 200 litres including industrial water use and tourism.”
18
MEETING PEOPLE’S DEMAND FOR WATER The increase in population requires that there is more water available to meet people’s increasing demand2. This means that it is necessary to collect as much as possible and implementing laws or policies to support alternative ways of obtaining water and saving is a good start. Alternative ways of obtaining water could be through the use of appropriate methods and approaches.
WATER SAVING METHODS AND TIPS Namibia is considered to be one of the sunniest countries in the world, with an average of 300 days of sunshine annually3. The climate is thus very hot and dry despite fluctuations during the seasons. Namibia receives an annual average rainfall of between 200 – 600mm
Construction & Mining Namibia, September - October 2017
(Ministry of Environment and Tourism, 2013) and this figure is set to decrease over the coming years because there is expected to be less and less rainfall received over the years. Combined with low rainfall rates, this thus means that its potential evaporation is higher than the precipitation, which again results in a very low humidity. 83%4 of the rainfall received in Namibia evaporates in the air, and the remaining 17% of water at ground level is used up by vegetation (14%), recharges groundwater (1%) and runoff (2%) harnessed in surface storage facilities. Namibia’s surface storage (dams) is 698.170 Mm3, however, only 358.482 Mm3 is presently available5 (18 Sept 2017). To ensure that people’s water demand is substantially met, given such dry conditions with less water availability, CoW6 for example urged its residents to adhere to the given water saving tips to combat water crisis: • • • •
Don’t flush the toilet unnecessarily. Water gardens only in the early morning or in the evening and only when necessary. Stop water leakage7. Shower rather than bathing.
RAIN WATER HARVESTING Rain water harvesting is a technique of collection and storage of rain water into natural reservoirs or tanks. Mark P. Rowe reported that roof-top rain water harvesting is mandated by law for all buildings in Bermuda9 and is the primary source of water for domestic supply. 8
To ensure that all Bermudan’s can harvest rain water, a fixed design in all roofing for buildings was necessary to be implemented. The roofs are white in colour, and terraced to slow down heavy rainwater and direct it to gutters, which in turn feed into underground storage tanks.
RAIN WATER HARVESTING AND NAMIBIA The water saving tips listed are very useful and lead to better water management. If there were possibilities for making better use of rainy seasons to save more water through rain water harvesting, this would increase the general water supply.
Dr. T. Uhlendahl et al. (2010)10, noted that during rainy seasons the City of Windhoek calculates a daily demand of 45,000 m³ on a rainy day and 75,000 m³ on a dry day. Given that 83% of rainfall is evaporated, this shows that there is a possibility for Namibia to implement rain water harvesting strategies for households to increase its availability. This practice will benefit both rural and urban areas.
Priscila (Olga) Chilombo Senior Intern – RDJ Consulting
Faith Ng’ona Intern – RDJ Consulting
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https://www.enviroawareness.org.na/commonfiles/files/%5BThink%20 Namibia%20Factsheet%203%5D%20Saving%20Water_final(1).pdf 2 This does not attempt to discount efficiency use. 3 http://www.info-namibia.com/info/namibia-weather 4 https://www.enviro-awareness.org.na/common-files/files/%5BThink%20Namibia%20Factsheet%203%5D%20Saving%20Water_final. pdf 5 https://www.namwater.com.na/images/data/dam_bulletin/_Dambulletin2017-09-18.pdf 6 http://www.windhoekcc.org.na/citi_electricity_water.php 7 Up to 30 litres of water can be wasted over a 24 hour period by a slow dripping tap. 8 https://www.sustainable.com.au/rainwater-harvesting.html 9 http://onlinelibrary.wiley.com/doi/10.1111/j.1752-1688.2011.00563.x/ abstract 10 “Water consumption at household level in Windhoek, Namibia” 1
Melanie Garises Intern – RDJ Consulting
Windhoek Tel: +264-61-233693 • infowhk@whssnamibia.com 5 Nickel Street, Prosperita • P O Box 20286 • Windhoek Swakopmund Tel: +264-64-462020 • infoswakop@whssnamibia.com 36 Hidipo Hamutenya St. • P O Box 2484 • Swakopmund Oshakati Tel: +264-65-226212 • info-oshakati@whssnamibia.com 19 Main Road • Oshakati Construction & Mining Namibia, September - October 2017
RESEARCH
BUILDING PLANS August 2017
A
total of 172 building plans were approved in August, an increase of 43 from the 129 approvals in July. In value terms however, approvals fell by N$24.7 million to N$116.2 million in August from N$140.9 million worth of approvals in July. A total of 29 completions to the value of N$20.1 million were recorded in August. This was a decline in dollar terms of N$71 million compared to N$91.1 million worth of completions in July. Year to date, N$1.71 billion worth of building plans have been approved, 22% higher than the corresponding period in 2016. On a twelvemonth cumulative basis, 1,851 building plans were approved worth approximately N$2.28 billion, 4.2% higher in value terms than approvals in August 2016. Of the total 172 plans approved in August, additions to properties accounted for 148 of those approvals. Additions to properties amounted to 105 in July, with this category usually making up the majority of approvals. This is an indication that there is continuous investment by property owners in the upkeep and improvement of property. Year to date, 1,008 additions to properties have been approved to the tune of N$749.4 million, 6.2% more than in the corresponding period in 2016.
in August 2016. On a monthly basis, new residential unit approvals increased by 37.5%, an encouraging sign given the slowdown in private sector credit extension. Commercial and industrial building plans approved for the year to date amount to 27 units, worth N$641.8 million. This being lower than the 55 building plans approved by the end of August 2016, although higher in dollar terms than the N$322 million in the corresponding period of 2016. Two commercial building plans valued at N$13.7 million were approved in August. On a 12 month-cumulative basis, commercial and industrial property approvals rose by 25.4% in value terms in August compared to the corresponding period in 2016, with the total number of plans approved falling only by 2 units. The 12-month cumulative number of building plans approved have been ticking up slightly
New residential units accounted for 22 of the total 172 approvals registered in August. Year to date 196 residential units have been approved, 45 more than in the corresponding period in 2016. In value terms, N$323 million worth of new residential plans have been approved yearto-date, 0.6% lower than the N$324.8 million 20
Construction & Mining Namibia, September - October 2017
since May, however falling marginally in August. In the last 12 months 1,851 building plans have been approved, 0.1% more than in August 2016. Government has reported settling all outstanding invoices, with the construction industry being a relieved recipient of those dues. However, with government still in a fiscal consolidation cycle and spending less on capital and infrastructure projects, we expect the sector to remain under pressure for the remainder of the year. Bank of Namibia (BoN) only recently cut interest rates by 25 basis points following the South African Reserve Bank’s (SARB) decision in July. The slowdown in inflation on the backdrop of subdued economic growth, has provided room to both central banks for further rate cuts, with MPC meetings scheduled for September and October respectively. Further relaxation of monetary policy in turn provides consumers with relative but very welcome relief that does flow through to their discretionary income.
GUEST COLUMN
HOW TO EXPEDITE THE ROLL-OUT OF INFRASTRUCTURE PPPs (PART 3):
T
he previous instalment looked on the importance of stable, clear, reliable and predictable legislative and regulatory frameworks. More specifically it highlighted how the absence in Namibia of necessary policies, legislative and regulatory frameworks and guiding procedures hinders full private investments in infrastructure development. In a nutshell a clear, reliable and predictable institutional, legislative and regulative frameworks through procedural clarity and efficiency; fair and transparent dispute arbitration means enhances maximum appeal of infrastructure to investors as a viable asset class. Thus to expedite private sector involvement in public infrastructure funding the government must ensure the establishment and formulation of these necessary frameworks. While a comprehensive and convincing National Infrastructure Plan underpinned by clear, reliable and predictable frameworks is important, yet it is not enough to facilitate maximum private sector involvement. Investors as business opportunities hunters, after all transactions are mainly interested in the financial returns a specific infrastructure project offers. That is PPP promoters in addition to creating a strategic infrastructure plan and fine-tuning policy issues, also has to ensure that infrastructure projects offer financial returns commensurate with initial private partner investments. These can brought in place through well-balanced risk mitigation and sharing methodologies. Risk management involves the identification of risks within a project, assessing the probability of the occurrence and potential impact on project performance, and effecting measures to prevent these events from hampering project success. Risk management is not a “once – off ” process happening at a project conceptualisation stage, but an on-going process spanning the entire project life cycle. The risk an infrastructure project poses differs according to the nature & type of project; developmental phase; country economic and political environments. PPP projects risks are categorised based on their occurrence in a
TOWARDS A BALANCED RISK ALLOCATION APPROACH particular phase of the project lifecycle. PPP projects lifecycle consists of the development, construction, and operation phase. The development phase is associated with risks such as land acquisition risk, permit risk, third parties risk, financing risk, equity risk, and credit risk. Risks such as completion risks, financial risks, and performance risks are observed in construction phase. Revenue risks and O&M risks are two major risks associated with the operation phase of the project. Risk identification and assessment involves conducting a wide-ranging preview of the project to anticipate all possible risks and their potential impacts. This is done through leverage checklists, applying scenario-testing techniques, hosting expert workshops, and reviewing earlier cases. Using the SWOT technique, the project team can also focus on the broad perspectives of potential risks by enquiring: what are the strengths and weakness of the project; and what opportunities and threats exist. Risk identification is followed by risk allocation, whereby risks are allocated to party best able to understand them, control their occurrence probability and/or minimize their impact at the lowest cost. Risks allocation between the government and private sector is depended on the type of PPP model and payment mechanism.
involves handling risks in a manner that achieves project and business goals efficiently and effectively. The private partner in PPP projects adopts various strategies to mitigate the risks allocated to them. One of the most commonly used risk mitigation strategies is the transfer of risk to other parties who can control the risk at a lower risk premium. Insurance is a risk mitigation strategy used by private sector to transfer the risk to third party. The private sector also adopts various hedging instruments to mitigate the financial risks arising from interest rate fluctuation, and foreign exchange variations. In addition to the above risk mitigation mechanisms, some of the risks cannot be retained solely by either party hence it needs to be shared between the affected parties. The successful implementation of the risk management strategy requires an effective communication and consultation plan amongst all project’s stakeholders. This will ensure that those responsible for implementing the risk management process understand the rationale underpinning certain decisions and the need for particular actions.
The structure of the partnerships between public agency and private sector can take different forms ranging from BOT to BOO, and to DBFO. Furthermore risk allocation between government and a private party, should also be cognisant of the private party organisational structure— its legal structure and contractual arrangements with the subcontractors — and the extent to which the risks being transferred are accepted in the subcontractors, insurers and financiers markets. Risk mitigation commences once the threats and opportunities facing the infrastructure project have been established. Risk mitigation
Hofni Unomasa Nguvenjengua
Construction & Mining Namibia, September - October 2017
21
DEVELOPMENT
Infrastructure development key to achieving NDP goals “Over the past couple of weeks, the Namibian Road sector has been in the news for a variety of reasons, be it financially or with regard to the upkeep of numerous roads used by companies, individuals and tourists alike. Fact is, we are currently lagging behind when it comes to road and rail infrastructure, something that is of vital importance to a country that strives to become a logistics and distribution hub by 2030,” says Namene Kalili, FNB Senior Research and Development Manager. In May this year the Namibian Government introduced the 5th National Development Plan, which encompasses a budget of N$ 69 billion of which N$25 billion is committed to roads infrastructure and another N$9 billion will be set aside for rail infrastructure. “The funds allocated for this in NDP5 are commendable, but fact remains that there is at this moment a backlog of N$255 billion in infrastructure development and a lot has to be done if the NDP5 goals are to be achieved.” In 2014, the Bank of Namibia broke down the infrastructure backlog into N$17.9 billion for roads, N$60.9 billion for railways, N$34.9 billion for ports, N$9.7 billion for airports, N$50.8 billion for energy and N$45 billion for housing. Namene advised that projects of such magnitude, like roads, rail, housing, and to a certain extent even education and health services, cannot be achieved by Government alone. “For many years we have been advocating for much more private -sector participation and the unlocking of investment channels to increase infrastructure spend. This would lessen the burden on government so that they can focus on social services and governance.” For Namibia to be world class in terms of infrastructure, a huge amount of money is needed, something that the Government will not be able to raise at the current tax rates. “We feel that the private sector must start playing a much bigger role and not be seen as provider of funds only. Namibians and non-Namibians alike, use our roads and as such they should be allowed to participate and contribute towards the construction and maintenance of the roads through the right investment vehicles to enable even broader participation. We are all aware that vehicle numbers and trade volumes have increased massively within SADC countries but our infrastructure is struggling to keep up with the demand and hence the roads have become very congested. Namene called for more ‘freedom’ in the maintenance, management and construction of infrastructure and less regulation on stakeholders as public goods and services. “Legislation may not allow road management to be implemented for a fee. Why not toll new roads thereby increasing the transport network at little to no cost to the tax payer, and placing the expense squarely on the shoulders of those who choose to use such roads?” This could lead to the creation of new road management companies, which could eventually list domestically to broaden equity participation, while reducing the road infrastructure backlog and increasing the quality of the national road network. “Listed entities are usually more transparent because of the strict public disclosure requirements from the stock exchange.” 22
Construction & Mining Namibia, September - October 2017
Namene Kalili FNB Senior Research and Development Manager.
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