Africa 78 (3), 2008 DOI: 10.3366/E0001972008000259

FROM SCOTCH WHISKY TO CHINESE SNEAKERS: INTERNATIONAL COMMODITY FLOWS AND NEW TRADE NETWORKS IN OSHIKANGO, NAMIBIA Gregor Dobler

Imported consumer goods have been an element in African lives for many centuries, but the increase in consumption has probably never been as great as in the past twenty years. Everywhere in Africa, people adopt new commodities that change their daily lives. Consumption, and the quest for consumption, has become one of the major modes of integration of young Africans into a global society, and consumption choices have become an important means to express personal identity in relation to the wider world, with all its social and economic discrepancies.1 Consumption is thus directly linked to political identities and to self-assertion in a context of economic deprivation, and the impossibility of making certain consumption choices ranks among the most acute experiences of exclusion. The symbolic interaction with the wider world through consumption relies on a very tangible mode of integration of African countries into the world market for consumer goods. In the past twenty years, transnational commodity trade into Africa has been the topic of a number of major ethnographies (for example, Burke 1996; Hansen 2000; Vierke 2006; Weiss 1996). While these provide detailed accounts of how the local construction of social reality through consumption is shaped by structural conditions, they focus on trade to and from the old colonial centres. But the old image of unilateral dependency of African countries on ‘the West’ or ‘the North’ is no longer accurate. Consumption in Africa is increasingly influenced by new trade linkages. China, India, Brazil or the Emirates emerge as new nodal points for commodity flows, often completely independent of old colonial structures. These new trade networks bring new and often cheaper commodities to Africa, but they also create new dependencies. What Africans can buy in their local shops and the price they have to pay is no longer determined by decisions in Paris, London or Washington.

GREGOR DOBLER is Lecturer in Anthropology at Basel University, Switzerland. He has previously taught anthropology and religious studies at Bayreuth University, Germany, where he obtained his PhD in 2002 with a study on the history of consumption on the island of Ouessant, France. This article is based on 15 months of fieldwork in northern Namibia in the period 2004 to 2008, studying the area’s economic and political transformation after the end of the Angolan war. 1 For perspectives on the use of new consumer goods in Africa, see, for example, Allman 2004; Arnould and Wilk 1984; Beck 2001; Belk 1988; Ferguson 1992; Hahn 2004; Prestholdt 2003; Rowlands 1996. NEW TRADE NETWORKS IN NAMIBIA 411

Instead, these choices and prices are increasingly influenced by political meetings in Beijing, chance encounters between businesspeople in Johannesburg, or the tax policies of the Pakistan government. These changes in Africa’s integration into the world market have become very visible in Oshikango, a vibrant trade boom town in the north of Namibia. Oshikango, although small, with only around 20,000 inhabitants, is a showcase of the structural changes that will affect the way we look at Africa and the way in which Africans will look at themselves. In this article, I describe trade networks that link Oshikango to the world at large and often bypass the old colonial powers completely. I use four commodities to illustrate my point: Scotch whisky, second-hand Japanese cars, Brazilian living-room furniture and Chinese sneakers. My analysis of these networks has two major aims. First, I wish to show how ongoing shifts in international trade are changing Africa’s economic, political and social relations with the rest of the world. Oshikango, though perhaps an extreme case, is not unique in being a single nodal point on which the plurality of worldwide connections converge or in illustrating the growing complexity of international trade networks. The world of consumption is no longer neatly divided into the former colonizers and the former colonized, and the emergence of new actors has led to more complex structures of economic domination. In looking more closely at the Oshikango case, it becomes abundantly clear that such new structures of economic domination are not just brought about by anonymous market forces, but through the individual actions of traders and businesspeople looking for profit under given economic conditions. All four networks in Oshikango are organized to a certain degree along ethnic lines, but they differ widely in structure and in their mode of integration into the socio-economic environment. The second aim of my analysis is to show how different types of collective action in trade networks contribute to African life by translating, in different ways, global structural conditions into local reality.

TRADE AND NEW FORMS OF CONSUMPTION IN OSHIKANGO Oshikango is a small town in northern Namibia, situated directly on the border with Angola. Until the mid-1990s, it was a small village consisting of a couple of homesteads and a dilapidated border post, which had been largely destroyed in the guerrilla war between the South African apartheid regime and SWAPO. The main road through Oshikango, built as an important supply route for the South African military, led into a country torn apart by war. Since the fragile peace in 1995, which brought a period of relative stability and reconstruction in Angola, this road has become the region’s most important trade axis, connecting Angola to the ports of Durban, Cape Town and Walvis Bay. Angolan demand for commodities is high, and the road makes Oshikango the ideal location to conduct wholesale trade with Angola from the south. The amount 412 NEW TRADE NETWORKS IN NAMIBIA of trade is enormous compared to the town’s size: goods worth around US$300–400 million are sold in Oshikango every year.2 Most wholesale warehouses sell nearly exclusively to Angolans. For many Angolan traders in the southern and central parts of Angola, Oshikango is more accessible than Luanda, and it is often cheaper and faster to bring Asian goods into Angola from Durban by truck than to ship them round the Cape to Luanda and transport them into the interior on Angolan roads. Above all, doing business in Oshikango is the best way for Namibian and foreign businesspeople to make money in Angola without investing there. The relative stability and transparency of the Namibian governmental and economic system provide security, while the reconstruction in Angola provides opportunities. For all these reasons, Oshikango has become a trade boom town since the mid-1990s, especially since Angola’s foreign trade liberalization in 1999. (For the history and structural conditions of trade through Oshikango, see Dobler 2008b.) Angola produces more than 1.4 million barrels of crude oil a day, and the country’s oil rents are being increasingly redirected from military spending towards reconstruction and elite consumption. As demand for building materials, furniture and household appliances has increased steadily after the re-establishment of peace, trade has become a major source of wealth for the well-connected establishment and a playground for young urban entrepreneurs. The bulk of their supplies come from the large warehouses in Oshikango, whose shelves eloquently capture Angola’s new world of consumption. Most of the commodities are traded offshore: they are not officially imported into Namibia but are sold to Angola tax free from bonded warehouses. The buyer has to pay Angolan import duties and VAT, but no Namibian taxes. The registration system was computerized in 2004. It is, at least officially, quite precise and reliable, and allows a good overview of the offshore trade in commodities through Oshikango. Cars, alcohol, furniture and household appliances (including video and audio systems) account for the bulk of the trade volume – more than 80 per cent. Apart from beer, all these commodities are imported. They are produced in South Africa, Japan, China, Scotland, Pakistan, South America or Singapore and arrive in Oshikango via various routes. Oshikango is the last station in the trade networks where goods are differentiated by their point of origin. Many Oshikango warehouses trade exclusively in goods from a distinct region. Traders who buy in Oshikango usually trade indiscriminately and simultaneously in

2 The exact figures are difficult to come by. According to data received from the Ministry of Trade and Industry, Namibia exported commodities worth N$2.5 billion (approximately US$300 million) into Angola in 2003, excluding the offshore trade. The average amount of offshore trade through Oshikango in 2004–6 was almost N$700 million. If we add to that a large part of the goods exported through Katwitwe (N$470 million in 2005, N$340 million in 2006) and an unknown amount of goods smuggled or transported into Angola in small amounts under the taxable threshold, US$300–400 million seems to be a fair guess for goods turned over in Oshikango alone. NEW TRADE NETWORKS IN NAMIBIA 413 goods from different countries of origin. Oshikango is where the trade networks of the producers meet those leading to the consumers and is, therefore, the first link in the chain of appropriation of foreign commodities.

FOUR COMMODITIES AND THEIR TRADE INTO OSHIKANGO The combination of Angola’s post-war trade boom and Oshikango’s border location makes the town a very good place to earn money by trading. Many people profit from the opportunities that Oshikango offers. Small, often informal businesses abound and offer an income to part of the local population. The large-scale trade market, however, is dominated by different groups of minority entrepreneurs. Chinese, Pakistani, Lebanese or Portuguese traders are among the most successful businesspeople in Oshikango. Even a cursory glance at these minorities shows how widely they differ in social status, organization and in the role ethnic networks play in commodity chains. Scotch whisky is still traded by specialized monopolist importers of European descent, a dominating minority that can link producers and consumers using old cultural and social ties. Although Lebanese and Portuguese traders play a crucial role in the Brazilian furniture trade, most of the trade does not draw on ethnic networks to link producers and consumers, but rather on ‘pure business’ contacts facilitated by international trade diplomacy: these minority traders have emancipated themselves from diasporic trade networks linked to their countries of origin. Used cars are brought to Oshikango by an international diaspora of Pakistani traders, foreigners both in the producers’ and the consumers’ countries, but linking both markets with their ethnic network. Chinese sneakers, finally, are traded by Chinese migrant entrepreneurs whose main business resource is their familiarity with Chinese markets and their ability to bridge the gap between the two countries.

Scotch whisky Since early colonial times, alcoholic beverages have been among the most important long-distance trade goods imported into Africa from Europe. The production of wine and of various spirits is usually tied to a specialized economy that relies on outside markets. Liquor can be transported easily over long distances and generates high surplus value. The history of alcoholic beverages in Africa is well documented (see, among others, Akyeampong 1996; Heap 1998; Pan 1975; for southern Africa, see Crush and Ambler 1992; La Hausse 1988; McAllister 2003; Mager 2005; van Onselen 1976). In the colonial trade of the late nineteenth century, they ranked among the main European export commodities. In southern Nigeria in the early twentieth century, for example, more than 60 per cent of import taxes were accounted for by alcohol (Olorunfemi 1984: 238). Cheap so-called ‘trade spirits’, 414 NEW TRADE NETWORKS IN NAMIBIA

‘produced for the sale to Non-Europeans’ (Wyndham 1930: 803) shared the market with brands produced for higher-class consumption.3 Trade in high-class liquor was especially extensive and lucrative in the settler colonies.4 The more expensive brands were usually imported from the colonial motherlands. When whisky started to change from a locally consumed spirit to a globally marketed commodity around 1850, it was soon exported to the British colonies (Storrie 1962). The Edinburgh blending firm of Walker’s was founded in 1820. The firm bought whisky from the producers, blended it and sold the product worldwide under its own brand, Walker’s Kilmarnock Whisky. Walker’s opened up new markets overseas by commissioning trade societies and ship captains to sell its products. Later, the resulting trade connections were consolidated through local representation. In 1890, Walker’s opened up an agency in Sydney, and by 1897 the firm had its first representative in South Africa. In 1908, Walker’s Kilmarnock Whisky was renamed Johnnie Walker. This early expansion was crucial to the success of the brand and made Johnnie Walker Red Label the best-selling Scotch whisky in the world. The centralized organization of the whisky trade – with production in Europe or by monopolistic concessionaires in the better-off colonies and distribution through a world-wide network of exclusive represen- tatives – has continued to shape the whisky trade up till the present. In Oshikango, branded liquor is the only important wholesale commodity still produced in Europe. All important wholesale traders come from families of European background: Portuguese whose families moved from Angola in 1974, white Namibians or South Africans whose ancestors came from Germany or Britain. The whole trade network from Europe to the Namibian wholesaler is organized along ethnic lines and functions much as it did in colonial times. The monopolistic character and capital-intensive nature of the trade mean that newcom- ers are restricted to the third or subsequent links in the import chain.5

3 Regulation of the liquor trade was an important topic in colonial policy. The colonial powers strove to achieve the goal of limiting native consumption of cheap liquor without damaging their export markets. After the agreement of St Germain-en-Laye in 1919, the most important instrument for regulation was the distinction between trade liquor and liquor for European consumption. The former (mainly produced in Germany or the Netherlands) was banned from certain zones and subjected to a different tax regime. While France prohibited the importation of spirits ‘except those made from the distillation of the grape, sugar-cane or fruit’, Britain included grain on the list. For further details, see Wyndham 1930. 4 The winelands of South Africa were an exception in so far as they were an important source of local liquor production as early as 1800. Small amounts of whisky were distilled in Paarl around 1840 and production increased sharply in the second half of the nineteenth century. In 1896, a German firm, Erste Fabrik Hatherly Distillery Company, bought the monopoly on whisky distillation. Lawson claims that the monopoly was grossly undervalued, as the distillery was able to pay 20 per cent of dividends to its owners, even though the concession had cost them $122,319 (Lawson 1896: 297). 5 The beer trade, on the other hand, is often in the hands of black businessmen. This goes back to 1976, when South West African Breweries yielded to political pressure from the apartheid government, keen to develop Ovamboland in accord with its own plans, and granted NEW TRADE NETWORKS IN NAMIBIA 415

In Oshikango today, alcoholic beverages account for more than 20 per cent of offshore trade. Their variety offered for sale is broad. It ranges from South African and Namibian beer to cheap South African wine to Johnnie Walker Black Label and Moët Chandon champagne. Beer still accounts for the largest quantities, even if beer sales in Oshikango have declined following SAB Miller’s decision to invest in breweries in Angola. The various whisky brands share an important part of sales, too. The most popular brands are Passport, a mid-price brand owned by Pernod Ricard, and Johnnie Walker Red Label, owned by the market leader Diageo. Whisky is sold wholesale by most of the larger warehouses, while only one warehouse specializes in liquor. All import commodities in these warehouses are in bond (imported duty free for re-export), which complicates accounting. In addition to the usual bookkeeping, import and export in bond must be registered in bond books and proved by customs documents. Import and export papers are filled in electronically and must be stamped by the local customs and excise office. VAT and punitive tariffs must be paid on unaccounted quantities. These payments, however, can sometimes be avoided by serviceable contacts or bribery.6 European liquor is shipped on container ships to Durban. Two importers share exclusive marketing rights in southern Africa: one markets, among others, Johnnie Walker, Passport, J&B and Famous Grouse, while the other sells Scottish Leader and Dewars. From Durban, the whisky reaches Oshikango in two different ways: directly to Oshikango by truck, or by train to Tsumeb and onward from there to Oshikango. Between importers and consumers, the liquor is usually sold twice or thrice: by one or two wholesalers and finally by the retailer. The channels of distribution from importer to wholesaler are very smooth. If the ordered quantities are in stock, an order usually takes three to five days to arrive in Oshikango. The containers are unloaded by hand, the boxes are piled on pallets in the warehouse and reloaded by hand when sold.7 All customers are Angolan businessmen. They fall into two different groups: small traders from nearby who buy only a few boxes of liquor

concessions to four well-connected black traders. In the following years, these businessmen, among them Frans Indongo, former Minister of Trade in the Ovamboland government, earned a fortune by selling beer to the South African troops stationed in the area. 6 Namibian Customs and Excise is relatively reliable, and one can count on getting the necessary papers in a short time, usually within three days. In recent years, however, it has become a rule that some dossiers are dealt with preferentially and can be dispatched within hours. Businesspeople have started to pay officers privately for preferential treatment. By doing so, they have raised general expectations, so that payments are gradually becoming everyday practice. 7 The pallets belong to the breweries. They have their own sphere of circulation and are not lent into Angola, which makes offloading and loading by hand a necessity. Furthermore, containers are not high enough to store more than one pallet, so that piling the boxes on top of one another increases the number of boxes per container. The warehouse hands, young men, are in fixed employ, but they receive much less than the minimum wages set by law. 416 NEW TRADE NETWORKS IN NAMIBIA and more often than not smuggle them over the border. Most of them repack the bottles in unlabelled boxes (often the original boxes are simply turned inside out) and try to sneak them into Angola by packing them between cheaper goods, in order to avoid import duties. In Santa Clara, the border post opposite Oshikango, smuggling has become more risky since February 2003, when the Angolan government charged the British Crown Agents with the supervision of the customs officers. For that reason, the second group of traders, large wholesale importers from Lubango or Luanda, often choose to export their shipments 400 kilometres farther east through Katwitwe, a tiny border post without telephone or computer networks. These traders often buy several forty-foot containers of whisky, and informal arrangements with local customs officers make even the large detour profitable. On legally imported liquor, Angola charges import duties of 35 per cent, plus another 30 per cent VAT, so the incentives to avoid the payments and to resort to bribery are high. (The most elegant approach to circumventing taxes was devised by an army general who had his shipments transported to Rundu airport, where they were picked up by military cargo planes and flown to his Luanda warehouses – free of charge and of taxes.) Business is transacted in cash in US dollars. Often, traders will pay for a shipment worth US$100,000 literally out of their pockets. The large traders usually send deputies to undertake the day-to-day transactions and only travel to Oshikango or Windhoek once or twice a year to keep up their contacts and to negotiate larger deals. Unlike the other commodities I describe, branded liquor can be bought and sold without inspecting individual shipments. The commodity is standardized and its quality does not change. This makes the market very transparent, and small differences in price or the exchange rate can induce traders to change their supplier. All traders are therefore interested in stable business relations with their customers. The practice of relying on general importers keeps prices high and makes customer retention easier to manage. Consequently, the trade in liquor runs smoothly and without complication from Glasgow to Lubango. The whisky trade from Europe to Africa is a continuation of the old colonial trade. The consumption it serves was influenced by colonial consumption history. Today, it also owes much to the publicity by large international firms and to the presentation of Western lifestyles in the visual media. The whisky trade follows the logic of luxury consumption: the ideal is the most expensive and most exclusive commodity, not the cheapest.

Brazilian furniture In all these respects, the trade in Scotch whisky is the exception rather than the rule. Only a small part of the commodities consumed in Africa today are still produced in Europe. New centres of production NEW TRADE NETWORKS IN NAMIBIA 417 have arisen, and trade relations between Southern countries are slowly replacing the old North–South networks. The importation of furniture from Brazil is a good example of trade relations with new countries that still follow established trade structures. Brazil is among the world’s most important suppliers of raw materials and is increasingly developing into a manufacturing production centre. The Brazilian furniture industry has seen an average growth of 23 per cent per year between 1990 and 2003. A large part of this growth has been due to increasing exports. Furniture exports from Brazil were worth US$40 million in 1990: by 2006, they had reached US$945 million.8 Most export furniture is standardized and mass- produced, and the sales figures are achieved more by price than by quality. Brazil is well positioned in this market, mainly due to its enormous wood reserves and comparatively cheap labour, combined with significant rationalization and modernization in the mostly small and medium-sized furniture factories. The lion’s share of Brazilian furniture exports goes to the United States and Western Europe, but the most dynamic markets are in Africa and the Arab states, where exports were six times higher in 2004 than in 2003.9 The success of the Brazilian export industry is largely due to bilateral trade policy and to the lobbying work of Abimóvel, the Brazilian furniture industry’s association. At ministerial level, at trade fairs or between chambers of commerce, contacts between producers and importers are arranged that enable direct imports. In Oshikango, Brazilian furniture is mainly sold by two large warehouses: International Commercial Pty Ltd, owned by a Lebanese family, and Sigma Trading Company, an import firm with a small production and assembly unit. Both import product lines directly from the factories owned by large Brazilian producers (Carraro in Rio Grande del Sul or Movelar in Linhares, among others). The packages bear the names and addresses of the producers, and often the imprint ‘packed for XY warehouse, Oshikango, Namibia’. As in all bonded warehouses, furniture price tags are in US dollars. A2× 2 metre cabinet with two glass doors, decorative columns and a two-door floor cupboard cost US$220 in November 2004; a set of lounge chairs in imitation leather seating one, two and three persons could be bought for US$550. In 2006, furniture worth N$60 million (approximately US$10 million) was exported through Oshikango border post alone: onshore exports of furniture from Namibia to Angola amounted to almost N$90 million in 2003. All told, the value of Angolan furniture imports across the Namibian border should be well over US$30 million – the equivalent of about 60,000 sets of lounge

8 http://www.furnitureglobal.com/news/news.asp?newsid=2371, 30 July 2007. Exports were even higher in 2005, as are projections for 2007. The decrease in 2006 is mainly due to the weak US dollar. 9 Data of the industry’s lobby, Abimóvel, cited from http://www.brazzilmag.com/ content/view/3147/49 21 July 2007. For export development in other countries, see Abimóvel 2004: 31. 418 NEW TRADE NETWORKS IN NAMIBIA chairs or 150,000 cabinets. The furniture is destined for Angola’s new urban middle class, who partake in one way or another in the country’s export rents: employees of parastatals, lower-ranking army and government officers, or urban traders. Most of the furniture is bought in Oshikango by medium-sized trading companies whose position in the trade is not sufficient to enable them to organize and finance imports directly from Brazil. They transport the packed furniture directly to Angola on trucks and sell it at their own risk. Often a truckload comprises different goods – say whisky, mattresses, building materials and furniture. The lighter lounge chairs commonly serve as additional cargo in truckloads of heavy building materials or liquor. Other customers, small traders or end users, buy only one or two pieces of furniture and consign them to one of the many freight services whose trucks regularly travel the same routes into Angola. A cardboard sign on the truck’s windscreen or on a fence nearby announces the truck’s destination. When enough merchandise has been consigned to the carrier, the truck leaves for the designated town in Angola, where the owner can pick it up. Brands usually do not play a role in the sale of furniture. Customers don’t connect quality or style with the names of manufacturers, and often they do not know or care if the item comes from China, Brazil or Europe. Since early 2006, one producer and his importer have attempted to change this perception by promoting a specific brand, and signboards praising ‘Da Costa – 100% MDF’ have appeared along Oshikango’s roads. Thus, brands may play a more significant role in the future, and this would be an important step for Brazilian producers. Until now, however, design is much more important than brand, and glitzy fronts count for more than durability. Furniture design must convey wealth and an association with a hypothetical Western model that is rooted more in Brazilian telenovelas than in lifestyles in Western centres. From many conversations with customers, the impression was gleaned that they are primarily looking for decorative and expressive facades as a framing of their own lives, not as objects of primary utility. Because of the absence of branding, the opening up of new markets by producers functions in different ways than in the case of Scotch whisky. It is not necessary to link a product with a certain lifestyle through publicity or convince the customer of the quality of a brand. The most important strategy – next to design – is to get in touch with local wholesalers. That is why trade policy and lobbying matter so much in the export of downmarket furniture to Africa. New business contacts are often arranged from the top, through political networking and strategic government exchanges. Decisions about consumption are thus influenced by trade policy – not concrete decisions on which commodities are appropriated in what ways, but simply the fact of which commodities are available for appropriation and which aren’t. On the political level, new South–South trade relations have become more and more prominent in recent years. Brazil is adroitly using its historic relationship with Africa and Africans to enhance its NEW TRADE NETWORKS IN NAMIBIA 419 chances on African markets, especially in Angola, whence very many Brazilian slaves originated. The country positions itself as part of the African diaspora and capitalizes on its common colonial past and the common language with African Lusophone countries. In official speeches, South–South solidarity and the common fight against (neo-)imperialism are often mentioned. Helped on by this political positioning, a dense network of economic relations between Africa and Brazil has developed.10 It may be doubtful that the new South–South trade will be more advantageous for Africa than the old North–South trade, but there is no doubt that the players in international trade and the origins of the commodities consumed in Africa are rapidly changing.

Used Japanese cars The sale of used cars is a special case in international trade: the commodities come from industrial countries but are distributed nearly exclusively by traders from the South. According to the South African Ministry of Transport, 80,000 used cars were imported through Durban into southern Africa in 2004. Since it is illegal to own them in South Africa, one must assume that most of them were exported to Namibia, Mozambique and Angola. In Namibia more and more imported cars have been sold in the last couple of years. Everywhere on the streets one can see Toyota Land Cruisers, Hi-Lux pick-ups, Corollas or Nissan Sunnys that still have Japanese stickers on their windscreens. They often differ in design from the models built in South Africa. Even if it is difficult to find spare parts for them, such used cars are very attractive to Namibian buyers. Prices for new and used cars built in South Africa are very high. Despite the high cost of transport, imported used cars from Japan or the US are often only half as expensive as comparable local models, and normally have far fewer kilometres on the odometer. To understand why the trade in used cars is so attractive and how it is organized, the best starting point is Japan, the biggest single source of used cars imported into southern Africa. Both Japan and the Anglophone countries of southern Africa drive on the left side of the road, thus eliminating the need for modification. Japanese consumers seem to have a special liking for new cars, and the average mileage of a used car is lower in densely urban Japan than in vast and sparsely populated Namibia. The liking for new cars is further accentuated

10 Brazilian President Lula da Silva, accompanied by trade delegations, has travelled five times to Africa since he took office in 2002. During that time, bilateral trade has doubled. His repeated reference to Brazil as the country in which, after Nigeria, most Africans live, is often taken up in the African discussion on diaspora and South–South relations. One prominent occasion for this was the CIAD (Conférence des Intellectuels d’Afrique et de la Diaspora) conference organized by the AU in October 2004. Apart from the furniture trade, one could cite many other examples of trade relations between Africa and Brazil. For Namibia, there is a naval agreement of 1994 that led to the sale of a Brazil man-of-war to the newly founded Namibian marine in 2004, or the massive import of chicken meat from Brazil when South Africa stopped its exports during the avian ’flu outbreak in late 2004. 420 NEW TRADE NETWORKS IN NAMIBIA by a tax regime favouring the Japanese car industry: car taxes rise dramatically five years after the initial registration of a car. This creates an oversupply of used cars and keeps the prices lower than in most other countries. In total, an estimated one million cars were exported from Japan, and the underlying trend is upward. This oversupply has consequences for the organization of the market. Most used vehicles are not sold to individuals, but to trade firms that auction them off in big public sales. The buyers, too, are mainly wholesalers, and trade volumes are amazing. According to its website, USS in Chiba, the biggest of these auction houses, sells up to 11,000 cars per day (http://www.ussnet.co.jp, accessed 15 December 2007). Such volumes cannot be handled by traditional methods, and for some years now the auctions have been held electronically. The dealers sit in a hall full of computer screens, pressing a button to place a bid. Pictures of the cars are projected on to the monitors and on to big screens mounted in the hall. The average time needed to auction off a car is twenty seconds. A new USS auction hall in Noda seats 2,400 dealers (Craft 2004). Within this trade system, dealers from Pakistan have become more and more important as wholesale buyers. Expatriate Pakistani traders first became involved in the international used car market in the 1980s, when the Pakistani government stipulated that used cars imported into Pakistan had to be owned by Pakistanis living abroad. When the import of reconditioned cars into Pakistan was banned in 1994, expatriate Pakistani car dealers living in Dubai and Japan developed new markets in Africa (Ahmad 2005). Today, the used car trade into the world’s poorer countries is firmly in the hands of expatriate Pakistani traders, even if new players are starting to emerge. Wherever used Japanese cars are sold, be it East Russia, Iraq, the Pacific Islands or Angola, Pakistani traders are involved. The big junctions of their international trade networks are Dubai for the Arabic countries and North and East Africa, Zarate near Buenos Aires for South America, and Durban for southern Africa. There are two typical variants of trade in used cars from Japan to southern Africa. A smaller number of cars is ordered directly from Japan. On the trade firms’ websites, one can find detailed descriptions of the cars on offer and can choose the appropriate model. The transport to the nearest port is organized by the trading company and charged to the buyer, who is responsible for all import formalities, taxes and registration. This is the cheapest way to import a car from Japan and is favoured by individuals looking for a car and also by local prospective dealers who want to move into the market without investing too much. As the wholesalers offer the necessary infrastructure and are easily accessible on the web, individual trade networks, personal contacts and dealer know-how are relatively unimportant. The greater number of cars are not shipped on demand: instead, they are sent by Japanese wholesalers to their overseas branches or to business partners for retail sale within southern Africa. These cars remain in bond until they are bought by local customers. Then, customs NEW TRADE NETWORKS IN NAMIBIA 421 clearance and registration formalities are taken care of by the dealers. Most dealers of ‘grey import’ used Japanese cars in Namibia are of Pakistani origin. Many of them are part of large trade networks, and those who are not have usually learned the trade in one of the big companies. The first southern African branches of international trade firms dealing in Japanese used cars were based in Durban. At first, they sold to local dealers in Mozambique, Zimbabwe or Namibia. In 1999, when Angola was developing into an important market, one of the trade firms founded a branch in Oshikango and started to sell directly to Angola, thus avoiding intermediaries. In 2004, there were six import–export firms selling used cars: all six were owned by Pakistanis. In early 2008, a further seven Pakistani firms had opened and were joined by five other new showrooms, four Lebanese-owned and one Namibian-owned. At the time of writing, it was still unclear how the Pakistani networks would be affected by the competition, but existing traders welcomed it, saying it would attract further customers from Angola. Most of the vehicles are still imported through Durban and transported to Oshikango by road. The bigger companies use car transporters, the smaller ones pay drivers – mainly white South Africans – to drive the cars from Durban to Oshikango. Currently, Pakistani trader networks end in Oshikango and the remaining links in the supply chain are in the hands of Angolan dealers. All over the world, the used car business is gradually becoming more difficult, as many countries have closed their markets to used car imports from Japan. In Namibia, grey imports are a contentious issue too. The first regulation was imposed by the Namibian government in 2003, when it banned new imports of left-hand-drive cars. This restricted market access for North American and most European cars and thus encouraged imports from Japan. In early 2004, the Angolan government followed suit by banning the registration of right-hand- drive cars. Through their international trade networks, import firms in Oshikango were able to react flexibly by increasing imports from the United States, while some also started to convert right-hand to left-hand-drive cars. A further blow came in November 2004 when the Namibian government banned the import of used cars older than five years from January 2005. This measure took the dealers and the public completely by surprise. It seems to have been the result of successful lobbying by South African car manufactures and by the RMI (Retail Motor Industry), the association of local car dealers.11 The new regulation did not affect offshore trade to Angola, but it robbed the traders of their Namibian customer base for right-hand-drive vehicles and made reorientation of supply bases necessary.

11 An advertisement in which the government warned against buying grey imports was paid for by Namibia’s biggest car dealership, Pupkewitz Motors. Moreover, the arguments government used – mainly reproaching Pakistani dealers for allegedly not sticking to the import regulations and the comment on the losses of local firms – were exactly the same as those of the RMI (Retail Motor Industry). 422 NEW TRADE NETWORKS IN NAMIBIA

The new regulations ignited fierce discussions in Namibia about the advantages and disadvantages of grey imports. Potential clients concentrated on the advantages of cheaper cars and emphasized the positive changes brought about by grey imports. They had most of the consumers on their side when they stressed that lower prices benefited everybody, not least small enterprises and the emerging black middle class. In Namibia, cars are both a desired luxury good and a necessary tool. Because of the large distances within the country, the popula- tion’s high spatial mobility and the poorly developed public transport network, cars are at the centre of public attention and are probably the most sought-after commodity in Namibia. For the many locals who cannot afford to own a car, private taxis are an important means of transportation. It is as a taxi that more often than not a car reaches the last stage in its life cycle – with notorious consequences for road safety. Grey imports have made better cars accessible at a lower price. ‘Today, you can find taxis here in Oshikango that are not even ten years old. I can’t think of any government measure that has improved road safety as much as the import of cheaper cars’, one local dealer claimed. The main argument of those advocating the new regulations was that the South African car industry and local dealers had to be protected. They claimed that cheap cars and the profits of a few international firms and minority entrepreneurs mattered less to the Namibian and southern African economy than a possible decline in the established car industry and its retailers. International car producers are divided on that matter: typically, the southern African subsidiaries of Japanese companies ally with their international competitors against grey imports,12 while Japanese mother companies seek to expand them. In fact, the export of used cars has many advantages for Japan. It generates direct trade revenues and solves the problem of disposal. Cheap used cars are an efficient and cheap way to open up new markets in poorer countries: they promote brand consciousness as well as an infrastructure of workshops and distributors of spare parts. Used cars, like second-hand clothes, are an example of the North– South trade in commodities whose consumption lifespan has ended in the industrialized countries. As in the case of second-hand clothing, their appropriation and the economic consequences of their trade are manifold and controversial. The international used car trade differs from the trade in second-hand clothing in one important aspect: the trade network is no longer in the hands of Northern companies. People from the South sell manufactured goods from the North to customers in the South. The used car trade is a niche market that does not require high initial investments, but only a personal presence on the scene and a high level of integration in a network of solidarity – conditions that typically foster minority entrepreneurship.

12 Toyota South Africa’s boss, Johan van Zyl, stood up for the ban on grey imports as early as 2002; his colleague Maureen Kempston Darkes, president of General Motors Latin America/Africa/Middle East, harshly criticized the abolition of a 20 per cent import tax on used cars in Kenya. NEW TRADE NETWORKS IN NAMIBIA 423

Chinese sports sneakers Minority entrepreneurs do play a part in nearly all import networks to Oshikango, but Chinese traders are the only expatriates selling commodities from their home country on a large scale. Currently there are over seventy Chinese-owned shops in Oshikango (see Dobler 2007; 2008a). Most of the shops sell the same commodities: textiles, shoes, electronics, motorcycles and a large array of goods ranging from calculators to wall clocks, from punch balls to perfume. The Chinese trade in Namibia is not confined to Oshikango. Many large and medium-sized Namibian towns have Chinese shops, all of which sell a similar range of goods. Chinese commodities play an ever- increasing role in consumption changes in Africa (see for example Alden 2005; Alden, Large and Oliveira 2008; Brautigam 2003; Haugen and Carling 2005). According to OECD data, the value of exported manufactured goods from China to Namibia grew more than one hundred fold between 1996 and 2003. The increase is less dramatic for Angola, as Chinese–Angolan trade relations started from a higher level due to the old alliance between the ruling regimes of both countries, but it is still very noticeable.13 The export figures represent a surprising volume of commodities – just one of the 22 Chinese shops in Oshikango sold more than 200,000 pairs of sports sneakers to Angola in 2004. Clothing articles are among the best-selling Chinese commodities. They are cheaply produced in the new Chinese industrial economy and are modelled on Western brands. Only a few shoes are really imitations, but most of the clothes bear famous brand names. Prices are very low by southern African standards. The first Chinese traders in Oshikango enjoyed profit margins of 50 per cent and more, but fierce competition has brought down profits to 10–20 per cent. Cheapness is in fact the main argument for buying Chinese. Some Chinese traders complained to me that they would like to sell better goods, but that the Angolans they sell to wouldn’t know the difference. Goods are usually imported in sealed containers from China to Oshikango and reach the town by truck from Durban. They are either commissioned directly at the factory or, for smaller amounts, ordered through wholesale merchants in China. All Chinese traders in Oshikango have agents in China – mostly a family member. Others travel to China regularly to seek out new goods and new suppliers and ‘to keep up with the contacts’. As all the Chinese shops in Oshikango are family businesses, wives, sons or nephews keep shop during the owner’s absence.

13 In 1996, the net worth of Chinese exports of manufactured goods to Namibia was US$132,000, in 2000 US$2.2 million, in 2002 US$9.3 million, in 2004 US$24 million. For Angola, the corresponding figures climbed from a yearly average of about US$7 million from 1996 to 2000 to US$16 million in 2002 and US$43 million in 2004. Total Chinese exports to Namibia went up to US$52 million in 2004 from US$8 million in 2000. The figures for Angola are US$33 million in 2000 and US$193 million in 2004 (OECD International Trade Statistics Database, SITC Rev. 3, China). 424 NEW TRADE NETWORKS IN NAMIBIA

FIGURE 1 William Li supervising the offloading of a container of sports sneakers, October 2004

The boom in the Chinese export economy has been extensively described and analysed. But why are there so many Chinese traders living in Oshikango? Why do Namibian businesspeople import Brazilian furniture, but diaspora Chinese import Chinese shoes? One answer is the greater cultural distance. Language is not the only barrier, but different business environments and different forms of political embeddedness make it difficult for foreigners to establish successful contacts with Chinese commodity manufacturers. Their ability to serve as brokers between the different business cultures is the main asset possessed by the Chinese traders in Oshikango. This is not to say that they feel at ease in both worlds from the start – on the contrary, they usually work hard to achieve this advantage. When they arrived in Namibia, most of them spoke neither English nor Portuguese. By dealing with Angolan customers, many of them have achieved reasonable proficiency in Portuguese, while most are still far from fluent in English. Business opportunities attract Chinese traders to many countries of the world, but they are not the only reason for their presence in Oshikango. The first steps were taken on a political level. Contacts between SWAPO and the Chinese government reach back far into the pre-independence era. In 1964, SWAPO President Sam Nujoma was NEW TRADE NETWORKS IN NAMIBIA 425 invited by the Chinese government, which was seeking contacts with southern African liberation movements loyal to Beijing’s rival Moscow. Later, China’s support in the UN for Namibian independence did much to strengthen the lopsided friendship. These inter-governmental relations later became the foundation of the Chinese presence in Namibia. In 1990, Sam Nujoma welcomed Chinese investments and Chinese businessmen into Namibia, and he has kept his word, in the process often angering local prospective businessmen, who feel that the Chinese are treated much more favourably by the Namibian bureaucracy. As far as the Chinese are concerned, they see Oshikango as a lucrative opportunity to escape the still strongly regulated economy of their country, its intense competition among businesses and the need to be well-connected in order to have a successful business. Most of the Chinese living in Oshikango today came after 1999. They had heard of Namibian opportunities from relatives or friends, and many learn the trade in a relative’s established business. Their backgrounds are as diverse as their hometowns – from the son of a peasant who started selling rice as a small side-business twenty years ago, to the upper- middle-class son trained at Beijing University business school. They buy and sell individually: nobody talks about his suppliers and nobody asks. Much to the dismay of the Beijing MBA, they do not fix prices, but compete with each other, even though cartels would be more profitable. As far as business is concerned, they are not an ideal example of a group of minority entrepreneurs. Socially, however, they form a close community. Unlike most businessmen in Oshikango, virtually all the Chinese live in their shops. They have small bedrooms attached to the shop or the storeroom. In the evenings, they sit outside their shops and chat with each other, and the large square between two wings of a shopping centre becomes their living room. They do not spend their evenings in pubs, as most people in Oshikango do: only a few of the youngsters go there to play pool or lose some money on the slot machines. More often, they play soccer with the locals. They give the impression of feeling at home, but they do not consider Oshikango their town. While they do not really mind being there, their common credo is ‘We are here for business’. Some of them have lived in other countries before, and all of them make it clear that they are willing to move on if business is better somewhere else. These pioneer entrepreneurs who introduce Chinese commodities into a succession of new countries are a decisive resource for the Chinese export economy. Rather than being a diasporic community of minority entrepreneurs, they are itinerant traders who take up residence for some time. The organization of their trade networks fits that role: they are the only group of expatriates in Oshikango who come to Namibia along with commodities from their home country, bridging the cultural gap that would otherwise make trade relations difficult. The old ties to their home country are more important to them and to their business than newly established ties in their country of residence. 426 NEW TRADE NETWORKS IN NAMIBIA

FOUR TRADE NETWORKS: A COMPARISON The warehouses of Oshikango plainly show how much the world of commodities in Africa has changed today, and how much old colonial trade networks have been supplanted in the process. The increase in globally produced commodities in Africa can no longer be described in terms of old North–South models. A constantly growing part of trade in Africa is linked to new manufacturing countries and new trade routes. These international trade networks influence which commodities reach African consumers, and their organization has important consequences for local consumption. I have described four of the hundreds of different trade networks that direct commodity flows into Africa. The people involved in organizing these networks differ widely, but they share the desire to earn money by bridging national, cultural and geographical boundaries. To do so, they draw on different abilities, different social networks and different forms of capital. They have no prior connection with Oshikango: they have gathered there because the historical and geographical situation of the town makes it a good place for their business. Even if it is not their aim to change life in Oshikango, their presence inevitably changes the living conditions of local people. Each of the four trade networks I have described is organized in its own distinct way and relies on a specific mode of social integration. Trade in Scotch whisky follows old colonial patterns. On the one hand, it is characterized by the exclusive character of the brands that enables producers to control trade networks tightly through concessions and keeps newcomers out of the market; on the other hand, standardization makes the trade foreseeable and uncomplicated, while giving high incentives for strong customer retention, as transparent market price competition could easily lead to a downward spiral. Both characteristics make it hard for new players to gain a foothold in the market, with the consequence that the whisky trade is still in the hands of formerly advantaged businesses and formerly advantaged people. Apart from branded luxury commodities, consumer goods of European origin have become an exception in the trade to Angola via Oshikango, and trade is no longer controlled by Europeans or Northern Americans. Western-style living room furniture is still a luxury commodity that only a few Angolans can afford, but, unlike whisky, furniture is judged not by the brand name but by its design. Consequently, commodities from countries whose producers don’t have the European luxury brands’ global exposure in the media have better market chances. Most of the furniture sold in Oshikango is directly imported from Brazil. The necessary contacts are made by manufacturers and wholesale traders, often facilitated and stimulated by political contacts. Pakistani traders dominate the used car trade in Oshikango. While, in the example of Brazilian furniture, contacts between producers and wholesalers are initiated symmetrically, the initiative in the used car trade lies exclusively with the Pakistani traders. They have opened NEW TRADE NETWORKS IN NAMIBIA 427 up new markets as pioneers and thereby created formerly non- existent demand. Consequently, the whole trade – up to the retailer or consumer – lies in the hands of one group. Pakistanis living in Oshikango are connected by a dense ethnic and religious network. This network provides access to all kinds of business resources, including social security, training of newcomers, procurement of credit and business contacts, and supply of spare parts. This creates ideal conditions for setting up competitive new businesses in underdeveloped markets. The world-wide trade in used cars is a model example of the expansion of commodities on the initiative of ethnic trade networks. Unlike the Pakistani car dealers, Chinese shop owners in Oshikango are not part of a tightly knit trade network. Rather, their business contacts resemble parallel strands stretching from China to Namibia, and the Chinese diaspora community offers them social contacts and friendship, not access to economic resources. But once again the spread of new commodities starts in the country of origin and is made possible by the emigration of traders who act as cultural brokers. As with Pakistani used car dealers, the main argument for buying in their shops is the price, not the design or the brand. All four trade networks are to some degree organized along ethnic lines. This, however, is not due to ethnic networks or to a specific business ethos prevalent among a migrant group. It is influenced much more by the place people from a similar background occupy in the global economy. The main resource of all traders in Oshikango is their capability of bridging different markets. All four groups of traders are best suited to bridge one specific gap between producers and consumers. Portuguese traders are thriving, but they would be incapable of negotiating prices in Shanghai, just as Pakistani car dealers are very successful minority entrepreneurs, but would be less at ease than people of British or German descent in linking up with South African whisky importers. Minority status, networks and inter- group solidarity do play a role in how they conduct their business, but are not the main factors in their economic success. Minority traders in Oshikango do not become successful because they are minorities – they emerge as minorities through market conditions in a globalized economy which create specific, culturally and socially distinctive opportunities in a given location. Each of the four minorities I have described is ideally placed to trade in a specific market segment. The reasons for their success are only vaguely known to most members of their host society, but the range of goods a minority trades shapes how the majority society looks at that minority. In post-colonial Namibia, consumption plays a crucial role for the reproduction of cultural values and social positions. Eighteen years after independence, access to consumer goods has become the epitome of liberation, an expression of the freedom to redefine one’s own social status. In the public discourse, consumer goods take up much of the space that was devoted to political issues during the liberation struggle. 428 NEW TRADE NETWORKS IN NAMIBIA

Among the most telling symbols of that change are the changing names of local shebeens and bars scattered across the towns and villages of northern Namibia. Most of them are named after the owner, or are called ‘Lucky Star’, ‘Blue Lagoon’, or ‘Sunshine’. But there have always been a number of bars with programmatic names. Many of the older ones were named the likes of ‘Democracy Works’ or ‘One Nation’. They stood for a new beginning and a new political order in one’s own land. Later, in the first years of the trade boom, bars were often called ‘Namibia & Angola Bottle-Store’, ‘King Madame Again’ or ‘Katwitwe Bar’ – names referring to the common heritage with Angola and to border-crossing identities. In recent years, even this kind of political message is left behind, and the most popular names emphasize consumption and modern living. The names ‘Rolex Bar’ or ‘Fashion House’ are self-explaining; the very popular ‘Supersport Bar’ takes its name from the two TV sets broadcasting Supersports channel on DSTV day and night. Oshikango’s visual landscape is changing with the names of shebeens. Billboards for consumer goods take ever more space, and the walls of warehouses are painted with bright images of the goods the affluent can buy there. Consumption certainly takes more space in public discourse than political programmes, and more and more people strive for a good life not through political struggle, but through individual prosperity. Consumption is both its expression and its ultimate goal. This is even more visible among members of the emerging Angolan economic business elite. For many of the Angolan traders I met in Oshikango, but mostly for young businessmen who are not yet part of the well-connected elite, consumption is an effort to find reliable markers of social status after the uprooting during the war. Consumption is a common gauge through all fractions of society. Toyota Landcruisers or bottles of Johnny Walker Black Label are real, no matter how fragile or fraudulent the riches were that bought them. Money as a common denominator works both ways: it is an incentive to spend much on conspicuous consumption and the least possible on everything else. In the eyes of the young traders, the most expensive luxury goods and the cheapest necessities are the ideal. On both sides of the scale, price matters more than quality. Radios, for example, are mostly no-name products built in China; they are discussed and compared by their prices, not their quality. The different luxury whisky brands, however, are known by everyone, and the traders choose their bars for their fashionability, not for low prices. On the Namibian side, this leads to a surprising re-politicization of public discourse on consumption. Western-style consumer goods are seen as the epitome of modernity and liberation, but their inaccessibility creates a growing sense of frustration that is not directed against the former colonizers’ trade, but against new players providing cheaper goods. South African firms, once the embodiment of a hated apartheid regime, take on the role of leading Namibia into modernity. Shopping malls comprising branches of South African chain stores such as Game, Shoprite, Pick’n’Pay or HiFiCorporation are inaugurated by Namibian NEW TRADE NETWORKS IN NAMIBIA 429

FIGURE 2 Painted advertisements on the walls of a warehouse, August 2006 politicians, accompanied by strong applause from media and the public. When President Pohamba opened a new wing of Windhoek’s flagship Maerua Mall in March 2006, he hailed it as a vital contribution to the country’s infrastructure, and the only criticism voiced in the media on that occasion was insufficient parking space. In northern Namibia, Oshakati’s shopping malls have become points of attraction and fascination. The Chinese shops do not share that privilege. Their sheer cheapness counts against them: both in the media and in everyday discourse, they are routinely presented as neo-colonial enterprises aimed at taking over the Namibian economy by flooding the market with cheap junk. This has to do with xenophobia, but it is fuelled by the image of Chinese goods as cheap substitutes for the real thing. Being liberated means having the right of access to Western consumer goods – to be on a par with the former colonizers. In a paradoxical move, this makes the presence of South African-owned businesses selling the big international brands a sign of liberation, while Chinese traders appear as colonialists trying to fob off Namibians with cheap trinkets. No Chinese or Brazilian brand of consumer goods has yet emerged as a new point of reference that could break the orientation of consumption dreams towards the old colonial powers. Perfumes or watches may be produced in China, but they still bear the labels of Hugo Boss or Rolex. Consumption, and the trade networks that make 430 NEW TRADE NETWORKS IN NAMIBIA it possible, shape the image Namibians have of the former colonizers and of emerging economic powers. They help to create mental maps of this world that will surely have political repercussions: the riots against Chinese traders in Zambia before the elections in 2006, or the movements against South African trade interests in many African countries bear witness to this fact. We cannot know how these world maps will look in a few years’ time. We do know, however, that the world map of real trade flows has profoundly changed over the last ten years and will continue to do so. In 2003, Crawford Young argued that the age of post-colonialism is over in African politics. In his view, African political practices are too diverse and too heavily influenced by internal factors and by changes in the international system to be meaningfully described as deriving from the colonial situation and its aftermath. Business in Oshikango suggests that on the economic level, too, the post-colonial period could soon be over. Structures of international economic integration are rapidly changing. It is true that many of the consumption models appropriated and changed by African consumers still develop in the old colonial metropolises. The largest part of real commodity flows, however, could soon bypass the global North completely.

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ABSTRACT After the end of the colonial period, international commodity flows into Africa at first continued to reproduce patterns of colonial domination. In the last ten years, however, important shifts have become visible. New commodity chains bypassing the old colonial powers have developed and are changing the way Africa is integrated into the global economy. This article looks at four trade networks that converge in Oshikango, a small trade boom town in northern Namibia. It describes how trade in Scotch whisky, Brazilian furniture, Japanese used cars and Chinese sneakers into Oshikango is organized. Whisky trade follows old colonial patterns; furniture trade relies on new South-South business contacts backed by political lobbying; in the used car trade, goods from the North are traded by networks of Southern migrant entrepreneurs; Chinese consumer goods are brought into Africa by Chinese migrants who bridge the cultural gap between the markets. Trade in Oshikango highlights the importance of new trade routes for Africa. Migrant entrepreneurs play an important role in these trade routes. A closer look at them shows, however, that their importance is largely due to opportunities arising from their place in the international system, not to a group’s inherent cultural or social characteristics.

RÉSUMÉ Après la fin de la période coloniale, les flux de marchandises internationaux entrant en Afrique ont continué, initialement, de reproduire les schémas de domination coloniale. Or, des changements importants sont apparus au cours de ces dix dernières années. De nouvelles chaînes de marchandises omettant les anciennes puissances coloniales se sont développées et modifient la façon dont l’Afrique s’intègre dans l’économie mondiale. Cet article se penche sur quatre réseaux d’échanges commerciaux qui convergent à Oshikango, petite ville du Nord de la Namibie dont le commerce est en plein essor. Il décrit comment s’organise le commerce du whisky écossais, des meubles brésiliens, des voitures d’occasion japonaises et des chaussures de sport chinoises à Oshikango. Le commerce du whisky suit les anciens schémas coloniaux; le commerce des meubles s’appuie sur de nouvelles relations commerciales Sud- Sud soutenues par un lobbying politique; le commerce des voitures d’occasion du Nord est assuré par des réseaux d’entrepreneurs migrants du Sud; les biens de consommation chinois sont amenés en Afrique par des migrants chinois qui comblent la fracture culturelle entre les marchés. Le commerce à Oshikango souligne l’importance des nouvelles voies d’échanges commerciaux pour l’Afrique. Les entrepreneurs migrants jouent un rôle important dans ces voies d’échanges. Un examen plus détaillé de ces voies montre, cependant, que leur importance tient essentiellement aux opportunités qui découlent de leur place dans le système international, et non aux caractéristiques culturelles ou sociales inhérentes à un groupe. This article was downloaded by: [Dobler, Gregor] On: 31 March 2009 Access details: Access Details: [subscription number 910045073] Publisher Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK

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Oshikango: The Dynamics of Growth and Regulation in a Namibian Boom Town* Gregor Dobler a a University of Basel,

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Oshikango: The Dynamics of Growth and Regulation in a Namibian Boom Town*

Gregor Dobler (University of Basel)

Angola’s economic re-integration into the Southern African region profoundly changes the economic and political landscape in the neighbouring countries. Apart from the country’s new political influence, Angolan buying power leads to an economic boom in formerly marginal places along its borders. Oshikango, the main Namibian border post to Angola, is perhaps the most impressive example of that change. Over the last 12 years, a forgotten outpost has developed into a sprawling boom town. In the first part of this article, I trace the town’s development and give an outline of the different economic activities that were instrumental in it. A second part concentrates on the role of the border for the town’s development and the construction of Namibian political and economic identity. While state regulations are enforced on both sides on the border, the transit between them is under- regulated and provides the economic opportunities that fuel the boom. The third part then looks at regulation within the boom town and its growing integration into the Namibian political landscape. The capacity of local administrators to profit from the boom rests on two interlinked factors: they are seen as bureaucratic representatives of state power, which lends legitimacy and leverage to their efforts of domination; but there is always too much to regulate in a boom town, which makes it possible to choose where and how to apply official rules without losing legitimacy. Through these dynamics of legitimacy and opportunity, the boom town of Oshikango is a place where state authority is reinforced, fuelled by the private interests of state representatives. Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009

Since Jonas Savimbi’s death, in 2002, sealed UNITA’s defeat and paved the way for a lasting peace in Angola, the consequences have changed the whole sub-region. Angola’s economic and political clout leads to a readjustment of the regional balance. This is particularly visible in Namibia’s northern regions. For a long time, the border with Angola had been on the periphery of a region centred on South Africa. Namibia’s northern border had been the boundary separating Anglophone and Portuguese territories; since 1975, it had been turned by South Africa into the defence line against ‘communist’ liberation movements. This marked separation is now replaced by increasing economic integration and a lively cross-border trade fuelled by the ongoing reconstruction in Angola. Namibia’s northern border posts have changed into economic hubs linking South African ports and Angolan markets.

*This article is part of a wider study on economic and political change in Namibia’s central northern border region. It is based on 14 months of fieldwork in Oshikango (June to December 2004, April to October 2006, January and February 2008), which was funded by the Swiss National Fund and Basel University and supported by the University of Namibia. A preliminary version of this article was presented at the ASA conference in San Francisco in 2006. Among the many people who supported the project and provided feedback, I am especially grateful to Jutta Dobler, Till Fo¨rster, Mattia Fumanti, John Grobler, Henning Melber, Paul Nugent, Cristina Udelsmann Rodrigues, Volker Winterfeld, Wolfgang Zeller and the editors and anonymous reviewers of JSAS. ISSN 0305-7070 print; 1465-3893 online/09/010115-17 q 2009 The Editorial Board of the Journal of Southern African Studies DOI: 10.1080/03057070802685601 116 Journal of Southern African Studies

Oshikango, a small town situated where the B1, Namibia’s main North–South transport corridor, reaches the border, is the most dynamic and the most rapidly growing town on Namibia’s northern border, and an ideal place to study the impact of regional re-adjustment on political and economic life in northern Namibia. In the first part of this article, I briefly outline the history of Oshikango’s transformation from a sleepy border post into a vibrant boom town. In the second part, I look more closely at the structural conditions that foster the town’s growth by providing economic opportunities. I concentrate on the role Oshikango plays as a transition point between two sets of political and economic regulations. While regulations are more or less consistent and sanctioned within a country, the transition between the two systems itself is only weakly regulated, providing economic opportunities on which Oshikango’s growth has been built. After this outline of the boom’s historic and structural conditions, the third part of the article considers its political consequences. With the establishment of a local government in Oshikango, ties between the town’s development and the national political and economic landscape have become stronger. Officials at the local level can only profit from their power to regulate economic development if they balance the benefits of patronage and self-interest with the legitimacy of their office in a political landscape characterised both by increasing links between business and politics and by an increasing awareness of corruption. As a consequence, even when administrators act for their own good, their actions can result in a consolidation of state power.

Oshikango as a Boom Town: Preconditions and Historical Outline

Oshikango’s life as a border post started in 1926, when the Portuguese and South African colonial administrations agreed on a different reading of the words ‘up to the waterfalls of the Kunene’ in the German-Portuguese treaty of 1886, and consequently shifted the border 11 km south to Oshikango.1 In 1928, the Officer in Charge, Native Affairs Oukuanyama (later Assistant Native Commissioner) moved his office from Namacunde to Oshikango. For a long

Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 time after this, Oshikango remained a small village and a remote outpost of the South African colonial empire. The village’s situation changed from stable unimportance to rapid decline after the start of the linked wars in Angola and in Northern Namibia, South African occupation turning the region into a war-zone, off limits to most outsiders and highly insecure for people living in the area. After Namibian independence in 1990, the region slowly recovered; many people moved back into their former villages, both from exile abroad and from the more secure areas in the South. But Oshikango remained a tiny place, with a school, a makeshift border post consisting of a caravan next to the old buildings destroyed in the wars, and an open market under a large tree on the main road. Oshikango’s boom only started in 1995–96 – as a result of outside investments rather than local initiative. The town’s enormous growth since that time is easily illustrated with two aerial views. The first (see Figure 1) was taken in 1996. It shows the early take-off phase. The first warehouses and the new border post have been built, and the first roads have been laid out. But the open market is still the village centre, and the new structures appear more out of place in the village than the seeds of a new town. The second view (see Figure 2) shows the town in early 2006. The first warehouses are now integrated into a landscape of similar buildings along the main road. The business town is oriented towards the border post, whilst new informal settlement areas have

1 Treated in detail by E. Kotze, The Establishment of a Government in Ovamboland, 1915–1925 (MA Thesis, Unisa, 1984), pp. 116–32; see also G. Dobler, ‘Boundary-drawing and the Notion of Territoriality in Pre-colonial and Early Colonial Ovamboland’, Journal of Namibian Studies, 3 (2008). The Dynamics of Growth and Regulation 117

Figure 1. Oshikango in 1996. (Aerial photograph, Namibian Geographical Service.)

developed on the outskirts, away from the main road. A rough estimation based on the aerial views would suggest that the built surface of Oshikango increased fifty-fold over

Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 those ten years. The official population of Helao Nafidi Town (comprising Oshikango and the neighbouring four settlements) in 2006 was 43,000, between 5,000 and 8,000 of them living in Oshikango. This growth was due to business opportunities arising from Oshikango’s proximity to Angolan markets and its strategic position on the main road from the South. After the devastation of war left Angola in ruins in 1992/93, the country experienced a slow recovery from the mid 1990s, when rebuilding began in government-controlled areas. The poor condition of the country’s roads made transport slow and costly, and building contractors, wholesale merchants and wealthy individuals looked to Namibia for supplies. Overland transport from the ports of Durban, Cape Town and Walvis Bay was safe, fast and relatively cheap due to new tarred highways through Namibia and the country’s well-developed transport sector. Furthermore, tax evasion was easier for many businesspeople on Angola’s southern border than in the capital (I elaborate on this later). For all these reasons, it was cheaper, faster and more reliable to buy goods in Namibia and to transport them to, say, Lubango or even Huambo, than to buy them in Luanda. In the mid 1990s, therefore, an increasing number of Angolan traders frequented the wholesale markets in Oshakati and Ondangwa, the major cities in Northern Namibia, and in Windhoek. They crossed the border at Oshikango, where the number of trucks waiting for their customs papers increased monthly. In 1996, the first major Namibian wholesalers moved closer to their Angolan customers by opening a warehouse in Oshikango. The first warehouses were built by Frans Indongo, one of the major black businessmen in Namibia, 118 Journal of Southern African Studies

Figure 2. Oshikango in 2006. (Satellite image, Google Earth)

who had laid the foundations for his business empire with shops and supermarkets in colonial Ovamboland (and, since 1977, a beer depot licence for South West African Breweries2), and by a Windhoek-based white trader. Soon after, other large warehouses Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 were opened – by an Angolan Portuguese family who had moved to Namibia in the mid 1970s, a South African working jointly with a Portuguese manager, and a Lebanese family that owned warehouses throughout Southern Africa.3 The warehouses enjoyed considerable success. They sold all kinds of goods, from building materials to whisky and from sugar to washing machines, and they attracted a large number of customers and wealth to Oshikango. In a second phase of the boom, pubs, motels and (more or less clandestine) sex workers catered for the visitors. The more formal establishments for a wealthier clientele occupied plots on the main road, while many informal shebeens and guesthouses opened up in the back roads or in the villages further South. Oshikango became a place to do business and to spend money. It attracted young men and women from the region in search of work or patrons. The next important step in Oshikango’s development was the arrival of used car dealers. These businesses – mostly Pakistani owned – import used cars from Japan or the United States via Durban. Here, too, the establishment of traders followed the buyers – Angolan wholesale traders had gone to Windhoek or Durban to buy used cars since the beginning of the 1990s.

2 National Archives of Namibia, hereafter NAN, OVE 9-1-3. 3 All of these firms are still in business today, even if some of them have seen crises and ownership changes for one reason or another. Only Frans Indongo, who moved his capital from trade into property and company shares, sold his warehouse to a Portuguese competitor when business declined in 2004. The Dynamics of Growth and Regulation 119

Around 1999, at approximately the same time as the first used car dealers arrived in Oshikango, two fruit and grocery businesses (Fysal’s and Brenner Fruit) – both owned by South Africans of Asian origin – and the first Chinese traders began trading in the town. Thereafter, the number of Chinese wholesale shops increased rapidly from around 25 in 2004 to over 70 by late 2006.4 People who have been in Oshikango since the start of the boom usually see its development as having happened in three phases: the pioneer phase to 1998, characterised by bad infrastructure, a chaotic social life, hard work and hard parties; the ‘golden days’ of the boom, from 1999 to around 2003–2004, when business started to decline; and the consolidation phase from then to the present, bringing further growth, but fewer opportunities in a more stable environment.5 While Oshikango and its society have changed considerably over the last 12 years, the town’s situation on the border has remained its main structural and economic asset.

Cross-Border Trade, National Regulations and their Implications for Oshikango

Border boom towns exist because people, goods and services need a passage point between two social and legal spheres. They thrive on difference, and on the necessity and possibility of bridging it. At first glance, no such bridge seems necessary between Oshikango and Santa Clara. People on both sides of the border belong to the same families, speak the same language, share a common history and lead very similar daily lives. But this initial impression is misleading. Many people doing business in the area are not from the region, and the formal rules governing business transactions are still established and changed within the national framework. In spite of all similarities, the border between Namibia and Angola shapes both perceptions and practices of people living close to it.6 From the start, the border was the line between two different colonial powers. Differing policies on both sides drew people into networks of domination and regulation which had

Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 their nodal points in Windhoek and Pretoria on the one hand, and Luanda and Lisbon on the other. The national classification never had a monopoly, of course, but it had started to form an important reality well before Angolan independence. After 1975, the line between the countries became the disputed northern border of South Africa’s zone of domination. When Namibia became independent in 1990, both the war and the war economy persisted in Angola, creating a patrimonial system that increased the connectedness to Angolan centres

4 See G. Dobler, ‘South-South Business Relations in Practice: Chinese Merchants in Oshikango, Namibia’ (draft 2005, see www.ids.ac.uk/asiandrivers); G. Dobler, ‘Old Ties or New Shackles? China in Namibia’, in H. Melber (ed.), Transitions in Namibia: Which Change for Whom? (Upsala, Nordic Africa Institute, 2007), pp. 94–109; G. Dobler, ‘Solidarity, Xenophobia and the Regulation of Chinese Businesses in Oshikango, Namibia’, in C. Alden, D. Large and R. Soares de Oliveira (eds), China Returns to Africa (London, Hurst, 2008). 5 My information of the early years of Oshikango relies on interviews with a large number of people, both business- people and peasants from the villages around Oshikango. I am especially indebted to Christa, Hans, JJ (both of whom have passed away since), Mario, Peter and Tate Immanuel. (As most locals know who my most important contacts were, and outsiders won’t be able to identify them anyhow, I refrain from further anonymisation.) 6 There is now a large body of literature on how colonial borders became important realities shaping the lived worlds of Africans. Landmark works include A.I. Asiwaju, Western Yorubaland Under European Rule: A Comparative Analysis of French and British Colonialism (New York, Humanities Press, 1976); W.F.S. Miles, Hausaland Divided: Colonialism and Independence in Nigeria and Niger (Ithaca, NY, Cornell University Press, 1994); P. Nugent, Smugglers, Secessionists and Loyal Citizens on the Ghana-Togo Frontier: The Life of the Borderlands Since 1914 (Oxford, James Currey, 2002); E. Kreike, Re-creating Eden: Land-Use, Environment and Society in Southern Angola and Northern Namibia (Portsmouth, NH, Heinemann, 2004) and D.M. Hughes, From Enslavement to Environmentalism: Politics on a Southern African Frontier (Seattle, University of Washington Press, 2006). 120 Journal of Southern African Studies

of power and sharpened differences between the social realms north and south of the border.7 In popular perception, Namibia became a realm of stability, peace and security, while Angola was characterised by opportunity, uncertainty and risk. Economic life in Oshikango is not merely regulated by border formalities, however – it owes its very existence to the necessity of a passage between two sets of regulations. Customs duties, national laws or transport regimes thus create or destroy the very conditions for Oshikango’s boom or bust, and changes in the border regime immediately affect Oshikango’s position. Regulation of cross-border trade affects economic transactions long before the goods actually cross the border. Most of the wholesale trade in Oshikango is done ‘offshore’. Goods are imported into Namibia ‘in bond’ and are thus not subject to Namibian VAT and import duties as long as they remain in bond or are exported. This implies that goods have to be registered with the Namibian Inland Revenue administration before they even arrive in the country. Usually, merchandise is imported in sealed containers, and the offloading process is supervised by customs officials who compare the goods with the packing list provided in advance. Once offloaded, goods in bond are stored in special sections in the warehouses. If a control finds discrepancies between the bond books and the actual stock, warehouse owners are fined and have to pay both VAT and import duties on the missing amounts. If a customer wants to buy offshore goods for export, the necessary papers have to be filled in and stamped at the customs office before the goods leave the premises, but the goods remain in the bond book until a copy of the papers is sent back from the border after the actual export.8 As the border town on the main road, Oshikango is the point where goods can cross the line between two administrative regimes most easily. This has turned the town into the passage point between two separate distribution chains: those from producers to wholesalers, and those from wholesalers to customers. Goods are traded and shipped to Oshikango in units organised by their country of origin. Chinese goods come in sealed containers from China and are sold by Chinese shops; Scotch whisky is imported by a specialised distributor in South Africa and dispatched to Oshikango by railway, in containers filled with nothing but liquor cases; Brazilian furniture is shipped by the factories, often specially packed for Oshikango Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 wholesalers. White goods mostly come from South Africa (even if they are produced in China), used cars from Japan or Texas, mobile phones from the Far East, sugar from importers and refiners in Namibia, groceries from South Africa, and so on ... In Oshikango, the goods are offloaded and sold, and then re-arranged in truckloads, no longer differentiated according to origin but determined now by demand from Angolan traders and consumers. The town is a nodal point of international trade networks, an entrepoˆt for consumer goods from all over the world. The border is crucial for that function in more than one way. If national regulations are important in making the border, and thus Oshikango, the private sector plays a crucial role,

7 For Angola’s political economy after the war, see, for example P. Chabal and N. Vidal (eds), Angola: The Weight of History (London, Hurst, 2007); T. Hodges, Angola: Anatomy of an Oil State (London, James Currey, 2003); S. Kibble, ‘Angola: Can the Politics of Disorder Become the Politics of Democratization and Development?’, Review of African Political Economy, 33, 109 (2006), pp. 525–42; R. Soares de Oliveira, ‘Business Success, Angolan Style: Postcolonial Politics and the Rise of Sonangol’, Journal for Modern African Studies, 45 (2007), pp. 595–619. 8 The system is, of course, slightly more complicated than presented here, especially where goods travel between warehouses or are not exported through the nearest border post. Today, papers are filled in with a computerised system using UNCTAD’s Asycuda and often transferred electronically. In addition to that form of offshore trade, some companies in Oshikango operate under the Export Processing Zone (EPZ) regulations. A large EPZ park was inaugurated in 1998, built mainly with EU funds, to foster export manufacturing. Most of the halls, however, are rented out to warehouses as storerooms; some other companies maintain some basic manufacturing activities, like furniture assembling, in order not to lose their status. The Dynamics of Growth and Regulation 121

too. I have mentioned earlier that Angola is still conceptualised as a wild and chaotic place ruled by reckless profit-making on the one hand, exclusive networks of patronage and friendship on the other hand. Business people are especially prone to such perceptions. Where they do not know their trade partners personally, the level of trust people typically accord their business partners tends to be much higher in Namibia than in Angola. This has drawn many investors to Oshikango in the first place; the town is the nearest you can come to the Angolan markets without actually investing in Angola.9 The lower level of trust Namibians and international investors place in the Angolan economy affects the private institutional side of business. It is very rare, for example, that warehouses sell to Angolans on credit. Both within Namibia and within Angola, trade relies on credit in various forms, but only a very select set of Angolan customers are able to negotiate later payments for goods they receive from Namibians. Even for those traders who do grant credit lines to good customers, the accounts are a constant source of worry. The great majority of transactions are done in cash, mostly in US dollars, which can be traded freely in Angola.10 In the offices of the large warehouses, it is possible to see people paying for truckloads worth more than US$100,000 quite literally out of their pockets. Even more striking is the reluctance of transporters and pallet owners to consign pallets and containers into Angola. Soft drinks and beer, for example, are brought into Oshikango on pallets owned by South African Breweries or the Namibian Breweries. Regular trade partners usually do not have to pay consignment for them, but books are kept on their number and current location. Neither brewery allows the pallets to leave Namibia for Angola. As a consequence, all drinks have to be loaded by hand on the trucks leaving for Angola, increasing costs, delays and breakage on treacherous Angolan roads. The same goes for the containers of many companies. There is nothing in national legislation to prevent pallets or containers crossing the border or the provision of credit for Angolan customers. That they rarely do so shows how separated the two markets are, and how necessary a negotiated passage between them is. The border between Namibia and Angola separates two sets of regulation and two imagined spaces. It is conceptually linked to two different modes of social interaction and political and economic Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 organisation, and Oshikango is one of the places where that conceptualisation of ‘Angola’ and ‘Namibia’ is negotiated, reproduced and changed on a daily basis. National economies, just like ethnic groups, often find their identities on their borders. Different regimes of power and a different institutionalisation of domination shape different everyday practices; these practices can be both occasions for, and the content of, the systematic communication of social and cultural differences. This interaction has made Oshikango the major trade boom town on the Namibian– Angolan border. The town continues to grow and to thrive because the social separation persists, and people in Oshikango have learned how to provide a passage way between them. But the opportunities that characterise trade in Oshikango cannot only be explained by this officially-sanctioned interaction. On the contrary, the possibility of breaking the chains of regulation at given points has been crucial for the boom. There is no better occasion for

9 I have spent some time searching for successful Namibian business ventures in Angola, with little success. Most Namibian firms who invested in Angola since the late 1990s moved back some time later, frustrated by administrative procedures, uncontrollable claims by patrons-to-be and non-payment by creditors and customers. The only successful investments were either low scale (a German citizen selling and running gambling machines in Namibe, or some local craftsmen putting up more or less official workshops in Angola) or high-profile, with a large amount of high-level government patronage, like a Namibian-Angolan joint venture to build 500 km of tarred road with SADC money. In the latter case, however, the main Namibian shareholder was trying to sell his shares. 10 Nambians have to declare transactions involving more than US$10,000 with the Namibian central bank and the customs office; the form F 178 has to accompany the export papers for the goods. 122 Journal of Southern African Studies

creativity in this regard than the point where one set of regulations ends and another one starts, as can be seen by the way in which offshore trade operates. Without it, incentives for Angolan traders to buy goods in Namibia would be much lower but even higher profits can be made by skilfully using the lack of regulation at the interface between the Namibian and the Angolan system. Although consumption taxes had been levied previously, Angola only introduced import duties in 2002 after the official end of the war, when a range of import duties and increased consumption taxes, ranging from 2 per cent for sugar or cement to 30 per cent on hard liquor or funeral cars,11 was imposed. A year later, however, the Angolan government saw that revenues from the southern border had barely increased despite the import duties. The reason was that traders avoided paying the new taxes by bribing tax collectors instead.12 Namibian officials seemingly did not mind corruption at Angolan border posts, as long as the Namibian papers were in order.13 In order to increase the Angolan central government’s tax revenue, the British Crown Agents were contracted to train and supervise Angolan customs officers. Expatriate Crown Agent employees were deployed to the Santa Clara border post. As a result, close supervision led to a steep increase in customs revenue – as well as to a decline of trade through Oshikango/Santa Clara. It did not lead to a decline in sales by Oshikango warehouses, however. Angolan customers continued to buy in Oshikango, but exported the goods through Calueque or Katwitwi border posts, where no foreign supervisors were stationed and corruption could still flourish. Katwitwi, in particular, became a favoured place through which to import goods into Angola. Until recently, the remote border post on the Okavango had no computer lines, no electricity supply save for a generator and no cell phone connection. Exporting goods through Katwitwi often implies a delay of four or five days but, given tax rates of 60 per cent, overall costs are still very much lower for the traders.14 Although in time the Angolan government may well close the loophole by extending supervision to Katwitwi,15 unless Namibian and Angolan governments co-operate to a much higher extent than today, other loopholes will emerge inevitably. At the moment, no side seems really to be interested in closer co-operation, perhaps because they lack resources and Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 trust, but possibly also because closer co-operation would narrow the scope for informal decisions on both sides.

11 For the tariffs see: Decreto/Lei no. 2/05 de 28 de Fevereiro – Pauta Aduaneira. 12 That practice was by no means limited to Angola. The Receiver of Revenue in Oshakati, Hans Haraseb, was found guilty on nine charges of misconduct under the Public Service Act in 2006. He had been responsible for tax, corporate tax and VAT payments from Oshikango bonded warehouses and had, for years, personally received reduced payments – in cash and without receipts. Under his supervision, round-tripping of goods earmarked for export was a frequent occurrence, too. These practices surfaced after the bankruptcy of the Santa Clara warehouse group in 2005; after Haraseb’s suspension, tax revenues from the bonded warehouse section in the North increased by more than a billion Namibian dollars. 13 A particularly revealing instance of this chosen benevolent ignorance is the case of an Angolan army general who used freight aeroplanes to import whisky for his warehouses in Luanda. The planes were first loaded at Ondangua airport, later (after a disagreement with an Oshikango warehouse owner) at Rundu airport. Reportedly, the general used military aeroplanes and imported truckloads of liquor without paying any duties or consumption taxes. The Namibian airport authorities issued clearances for landing and take-off without any questions. 14 It may be said in passing that the negotiation between different trade routes is not new in the area. In 1883, the Earl of Mayo mentioned that W. Jordan, a Boer trader at Humpata who later established Upingtonia near Grootfontein, ‘found it cheaper to drag his goods in wagons from Walvisch Bay rather than to pay the excessive duties at Mossamedes’. (Earl of Mayo, ‘A Journey from Mossamedes to the River Cu´nene, S.W. Africa’, in Proceedings of the Royal Geographical Society, New Monthly Series, 5, 8 (1883), p. 472.) 15 It is, of course, inconceivable that the Angolan government should be unaware of tax evasion at Katwitwi, and it seems reasonable to assume a certain degree of connivance by higher authorities. This is possible because tax income is negligible when compared with oil and diamond revenues, but the government probably has more concrete reasons, too. The Dynamics of Growth and Regulation 123

To take just one example: both sides collect statistical data on imports and exports through their border posts, using the same SITC system. It would be very simple to compare the respective data to see if goods officially exported from Namibia are officially imported into Angola, too. There is no such comparison, however. While it was easy to obtain Namibian data from the Ministry of Finance and the National Planning Commission, efforts to obtain Angolan import statistics by border post proved fruitless. This opacity and non-cooperation opens a space for creative action by traders. Whereas regimes on both sides of the border are more or less highly regulated, the transition between the two sets of regulations is not itself regulated. Both goods and people leave Namibia in a clearly defined legal state, but once they leave Namibia, this definition is no longer valid: a new status must be defined by the application of Angolan regulations. This new definition is much freer and more easily influenced by corruption or patronage. Often, goods can simply disappear from the books when crossing the border. Once they are registered as outside the country, the Namibian side is no longer interested in them; before they are officially registered in Angola, the Angolan side can simply ignore their existence. There is, of course, a high level of completely legal trade into Angola. But the greatest profits (and thus incentives to buy in Oshikango) start where regulations can be circumvented, and Oshikango is not booming in spite of the separations between the two countries, but because of them. The town thrives because it is the point where different actors can live on their ability to influence the transition between the two countries.

Order and Regulation in a Boom

The opportunities arising from Oshikango’s boom draw people from near and far to try, or buy, their luck in Oshikango. From the perspective of the Namibian state, this calls for regulation and control. The resources that come together in Oshikango have to be channelled and put to use for controlled and sustainable growth. Unlike in other boom situations, economic actors in Oshikango are not opposed to regulation, even if they often try to Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 circumvent new rules. For the more powerful actors, especially the warehouse owners, the concrete regulation on the Namibian side is less important than the business opportunities that arise from the passage between Namibian and Angolan regulations. The town’s authorities are thus free to impose an official set of regulations but, in the boom situation, their capacity to regulate is always overtaken by the reality of informal actions. In the second part of the article, I concentrate on the political aspects of the boom, and on the dynamics of opportunity and regulation. I will examine the possibilities that emerge for political actors within the town’s administration, and to show how political power in Oshikango is increasingly integrated into the national political landscape.

Young Modernists: The Administration

Unlike business transactions, the regulation of public life on both sides of the border still very much functions within the national context. On the Namibian side, the most important instrument of regulation has been the creation of Helao Nafidi Town and the subsequent implementation of a town administration. Prior to the establishment of the town, the area was administered by the regional government in Eenhana and land was state-owned. Access to agriculture or new homesteads was regulated by local headmen; for business purposes, no title deeds to land were available, although the regional government could issue ‘PTOs’ (Permissions to Occupy), that entitled the applicant to build on the ground without a transfer 124 Journal of Southern African Studies

of ownership. In 2003, the national government decided to turn Oshikango and the surrounding settlements into a town to encourage investors and facilitate regulation. Land within the confines of the town could now be bought and sold as freehold, even where the town itself lay within the communal areas. The town was proclaimed and a Town Council elected in April 2004. All council members were elected on the Swapo list. For the first six months, a delegate from the Ministry of Local Government served as town clerk – or CEO, as the position is called now. In November 2004, he was replaced by the new CEO, a young man with a strong Swapo background and experience in local administrations further south. For the first two years, the town’s administration occupied a shabby office in the former Traditional Authorities’ Hall in Ohangwena but, in April 2006, a new building constructed by a Chinese contractor for N$8 million was opened by President Pohamba. The administration is strongly dominated by the personality of the new CEO. As head of the administration and ex officio member of the Town Council (although without a vote), he is the one person who really knows what is going on both on the political and on the everyday level. He is well connected in Windhoek and makes use of these connections as a resource for his work. He does not see his future in Oshikango, but wants to return to Windhoek or another town further south after the end of his five-year contract. His work for Oshikango thus serves his own career, too, and many people in Oshikango find it difficult to tell what lord he is serving most ardently. He sees his official task as transforming Oshikango from an informal outpost in a rural setting into a modern business centre. This inevitably leads to conflict. Many of the local people living in the area since before the boom feel estranged by this transformation and by the town’s rapid growth. Oshikango’s tarred roads, supermarkets, billboards, formal hotels and discotheques are in sharp contrast to rural life in the surrounding areas. Most of the town’s administrators are ardent believers in modernisation. The better qualified city employees are in their late twenties or early thirties; they have lived in Windhoek for some time and are glad that Oshikango offers at least some form of ‘modern’ life. If they don’t go to Oshakati or Windhoek, they usually spend the weekend nights in Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 Oshikango’s more expensive bars and nightclubs. In their eyes, Oshikango is destined to become a modern business centre, and the sensitivities of people who were living there before the boom cannot be allowed to matter too much. The CEO is perhaps the most outspoken proponent of this kind of ‘development’. When asked, in September 2006, about the relocation of some people after their ground was sold, he told me: ‘There are always people who stand in the way of development. That is hard, but that’s how it is. [ ...]We relocate them, they are compensated, and where they used to live, 20 people find work. I do not mind if there are still homesteads in the town area. Let them stay there – as long as they replace their wooden fences with walls.’ When asked why wooden fences should be replaced by concrete, he was at a loss to explain the evident. ‘But – they have to adapt! We want the town to be nice,tobemodern. You cannot have these wooden palisades in a nice town.’ This modernism (or rather ‘modernisationism’) is both a personal persuasion and an official vision. In the current Namibian context, it is highly legitimate and shared by many members of the political class. Government, media and civil society measure progress in developmentalist terms and define political legitimacy in relation to ‘development’, Namibian ‘Vision 2030’ or the Millennium Development Goals. At the same time, this vision clearly becomes a means of power and domination. It redefines political exclusion – like in the case just cited, where rich homesteads of the local elite are suddenly redefined as the slovenly remains of an agricultural era; and it can mask particularistic aims with a highly legitimate universalistic ethos. The Dynamics of Growth and Regulation 125

The CEO’s modernist and liberalist approach has served the town well in many areas, and his administration has been quite active in the past years. The town is prospering financially; electricity and water supply are working without problems, waste removal is efficient and well organised; the master plan that, back in 1997, had defined zones of settlement, business, accommodation and recreation, has been reformed and partly put into practice; the plots on the town lands have been newly surveyed, and property rates have been enforced. A business register is being established in order to facilitate tax and utility fees collection and give the administration a more realistic image of the town’s life. International contacts to attract investors have been established – for example, a twinning agreement with a Chinese town was negotiated in 2006. All these measures align with the developmentalist vision and, in the official perspective, Oshikango is indeed on the way to transform from a place of wild and undomesticated capitalism into an ordered space with the best prospects for sustainable growth. If we look at how these policies are put into practice in everyday life, however, the picture becomes less clear – and sociologically more interesting. The order that is established through the administration’s actions is less impartial than it appears: the universalistic vision of development is cast into structures of domination which serve the individuals who are in charge of implementing it.

Regulation in Practice

I will use the case of an aborted building project to illustrate the complexities of the setting up of a new administration in Oshikango. In May 2005, the ‘Northland City’ project was first presented to the public. It was conceived as a N$300 million shopping mall near Oshikango, catering for Namibian and Angolan customers. By the time that Namibian President Hifikepunye Pohamba officially launched the project in October 2005, it had grown into a billion-dollar project, including ‘a shopping complex, a five-star hotel, conference facilities, a casino, a nightclub, a golf course, heritage museum, an Olympic swimming pool, a track and Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 soccer stadium, a wildlife park and an entertainment centre’16 creating employment for about 3,500 people. From the start, the project had considerable political support from Ovakwanyama politicians in the capital. The company’s chairman was a former ambassador to South Africa and Belgium, Shapua Kaukungua; the management included the former chairman of the National Council, Kandy Nehova, and Swapo MP and Ohangwena Regional Councillor Karlous Marx Shinohamba. Minister of Broadcasting Netumbo Nandi-Ndaitwah (the daughter of a prominent Anglican catechist from Odibo, 5 km from the planned development) served as the official patron of the project. The man behind the scheme, who had recruited these respected and well-connected political supporters, was Tony Mbok, a Cameroonian citizen and businessman who had been living and working in Namibia for many years.17 From the start, the financial basis of the project seems to have been as shallow as its scale was grandiose, but Mbok succeeded in getting support from some major Namibian companies.

16 Namibian, 21 October 2005. 17 Mbok’s business ventures as reported by the Namibian press have included: organising a charity dinner in 2003 – organised without the prior knowledge of the prospective beneficiaries, who were later informed that the event was unsuccessful and overheads exceeded the money raised (Namibian Economist, 2 April 2004); starting a financing company that illegally put up shares for sale before being registered; and the ‘Dignity Housing Initiative’ that ceased payments after collecting deposits from poor Windhoek residents looking for affordable housing – another business involving Pam Golding Properties (Namibian, 16 April 2007, 5 June 2007, 7 April 2008, 4 August 2008). He bought a plot in an affluent area from the City of Windhoek in 2005, but never paid for it, so that his ownership was cancelled in April 2007 (Namibian, 30 April 2007). 126 Journal of Southern African Studies

The parastatal RCC (Roads Contractors Company) headed by Kaukungua’s nephew Kelly Nghixulifwa18 was contracted to build the complex; Pam Golding Properties was responsible for marketing the built space; Nedbank, First National Bank and the Development Bank of Namibia were to finance the project. In spite of the standing of these partners, the idea of building an 18-hole golf course and a waterfront in Oshikango was shady from the start. A building contractor close to the RCC told me in 2006 that no private company in Namibia would ever touch the project – industry was convinced the company would not be able to pay any bills. Some Town Council members in Oshikango expressed similar opinions, but in the media and among the public there was surprisingly little controversy around the project. Once again, the developmentalist rhetoric lent legitimacy to a project that would otherwise have been inexplicable. On the part of the political supporters, some of whom invested their own money in the project, there was a belief in big development and so they bought into the Vision 2030 rhetoric. They were proud to be part of a project that brought ‘a second Sun City’ to their rural homeland, proving that northern Namibia could be part of modernity even in its most advanced aspect of consumption. In Oshikango, the CEO managed to present the project as a major opportunity for the town, while the political stature of the project’s proponents impressed everybody.19 The Town Council granted a large piece of prime land for Northland City for free and apparently without any conditions attached.20 On that land, adjacent to the new Town Council building, a signboard announcing the project was put up. Under the heading ‘Northland City, Helao Nafidi, Ohangwena’, it showed a rather vague architectural sketch and advertised ‘The largest shopping complex ever built in Namibia – Coming soon – 1000 shops and offices!’ A bubble in the left-hand corner aptly, and without a hint of irony, summarised the spirit of the project: ‘This is what we fought for! Enjoy!!!’ Thus, a shopping complex that symbolised the possibility of participating in the global consumption activities of the former colonisers came to be represented as the ultimate embodiment of liberation (see Figure 3). The peasants living on the land given to Northland by the Town Council did not share that Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 enthusiasm, however. They had been informed in June 2005 that they would have to leave, and that an assessment of their immovable property would establish the appropriate level of compensation. A regional government official drew up an inventory, but the villagers were neither informed about the outcome nor the intended procedures. In May 2006, they appealed to the Legal Assistance Centre in Windhoek, who took up their claims with the Town Council. In the meantime, personal problems and quarrels over the company’s strategy led to the management of Northland City being completely reshuffled. Importantly, Mbok, the main shareholder,21 had realised that the political board members had slowly become a liability for

18 Nghixulifwa resigned from his post in January 2007 after being suspended by the RCC for alleged irregularities in another big RCC project (the B1 motor city near Windhoek) that failed to materialise. 19 Tony Mbok himself claimed that he paid for the wedding and a honeymoon trip of the CEO, who allegedly approached him later for a credit. It is not clear what the full facts of the matter are. 20 It seems that, when Tony Mbok withdrew from the company in 2006, the title deeds remained with him; one of the town councillors told me that they were unable to revoke the deed for lack of the promised development. 21 Sources varied as to the amount of money put into the company. Mbok invested N$1.5 million, money that apparently came from his mother’s company; Robert I. Kennedy promised N$40 million, but apparently withdrew before paying; Kandy Nehova contributed N$400,000 and Shapua Kaukungua N$20,000. The shareholding structure differed from the investment, however, with Kaukungua and Nehova each holding 5 per cent, Kennedy 9 per cent and Mbok 10 per cent in his personal capacity and 45 per cent through various companies. The Dynamics of Growth and Regulation 127

Figure 3. Signboard near Oshikango, September 2006.

him achieving his aims. Since the presidential nomination process in 2004, Swapo was deeply divided between competing factions.22 Kaukungua, Nehova and Shinohamba emerged as Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 supporters of the leader of the anti-Nujoma faction within Swapo. Three weeks prior to his sacking as Northland manager, Shapua Kaukungua’s election as Swapo district co-ordinator for Windhoek East was voided by Swapo regional coordinator Michael Mwinga, a sign of unpopularity with Nujoma that was surely not overlooked by Mbok.23 When a new opposition party, the Rally for Democracy and Progress, was formed in late 2007, Kaukungua, Nehova and Shinohamba were among the first to leave Swapo to join it. The new management of Northland City after the reshuffling consisted of Mbok, the American Robert I. Kennedy, one Gerry P. Lynch and South African military captain Sunesh Indur. In August 2006, Mbok finally sold his 60 per cent share in the project for N$5 million to PNL Business Solutions, a company headed by Windhoek magistrate Peter Kavaongelwa.24 Unfortunately, Kavaongelwa’s initial cheque of N$500,000 bounced, putting a stop to the development. This failed business venture shows how the boom in this Oshikango, and its regulation, was integrated into the Namibian political landscape. I have argued earlier that Oshikango’s

22 See G. Dobler, ‘Les e´lections en Namibie de Novembre 2004’, Politique Africaine, 98 (2008), pp. 166–79. 23 For further details, see the article by Michaela Huebschle and Shapua Kaukungua in the Namibian, 9 February 2007. 24 Kavaongelua is the head of the Katutura Magistrates’ Court and former Secretary for Labour and Economic Affairs in the Swapo Youth League. He failed to obtain the necessary permission for his business venture from the Magistrates’ Commission, claiming that he did not know it was necessary (Namibian Economist, 25 August 2006). 128 Journal of Southern African Studies

boom depended on the boundary between two sets of national regulations. In spite of this, in the early years of the boom, the town’s development was relatively independent from political connections at a national level. In the Northland City project, however, and despite its failure, a deeper integration into the national political landscape becomes visible. Before 2004, the absence of regulation implied an absence of political influence. Most business ventures were driven by energetic pioneers directly involved in the running of their companies. ‘Formerly advantaged persons’ prevailed;25 the Namibians were soon joined by South Africans, often of Asian descent. For their businesses, political protection on a national level did not matter much. Good relations to local customs officers, receivers of revenue and the clerks in the Regional Council’s office were more important. The boom town was a world of its own, de-linked from mainstream political culture in Namibia. Business interests were independent of, and prevailed over, politics. After Oshikango became a town, and the town’s administration imposed itself as the regulating power, politics and political connections became more important. It is impossible to be a member of the Town Council, or to get an important job in the town’s administration, without a good record within Swapo. The town’s CEO needs access to ministry officials in Windhoek, who almost exclusively are Swapo members – state structures and party structures are inseparable from each other, and both intertwine with friendships and enmities from the struggle years. The CEO needs access to investors from Windhoek who more often than not are linked to national politics. As a consequence, politics at the town level are highly affected by national politics. Factions and conflicts of allegiance within Swapo often find an outlet on the local level, while local animosities inform political patronage in Windhoek. In turn, every new investor in Oshikango depends on the local regulatory body. When somebody wants to establish and run a new business in Oshikango, the administration can decide to become involved in many stages. The most important step is to get access to a piece of land, and the authorisation to construct a building on it. Prices paid for urban land is, as a rule, much lower than prices on the free market, and large profits can be made by reselling land after some time. As a consequence, the demand for urban land is very high, and the process of land attribution is highly selective. Prospective investors often complain about its Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 arbitrariness and lack of transparency. At a later stage in setting up a company, electricity and water supply, waste removal, small alterations in the buildings and so on are all possible areas for administrative action and for regulation. At each of these points, the administration can chose whether to apply a rule or to ignore it. In 2004, to illustrate the point with an everyday example, one of the warehouse managers in Oshikango put up a signboard advertising his shop, attached to a metal frame and anchored in concrete foundations. He did not apply for permission to erect it on ground that was then reserved for a pedestrian walkway. While I was sitting in his office, the town’s CEO phoned the company’s manager and made his position of authority very clear: with quotations from the relevant regulations, he informed the manager that he was liable for a fine for having put up the billboard without prior authorisation. He added that the manager would have to have the structure removed within 24 hours or risk both a larger fine and a six months prison term. After the long phone call, he explained to me that ‘those people’ thought the town belonged to them because nobody had ever contradicted them. ‘He even asked if we could arrange this somehow. Those people think I am not doing my job, but they will be surprised. The town is just a business like any other, but we are functioning according to certain rules, and it is my job to see that those rules are observed.’

25 The only exception to that rule was Frans Indongo – if it is possible to include a black millionaire who was very well connected even before independence and served as minister of economic affairs in the pre-independence Ovamboland government in the category of ‘disadvantaged’. The Dynamics of Growth and Regulation 129

In 2008, the signboard was still standing at the roadside, although slightly faded, and attempts to find out whether it was now legally sanctioned proved futile. It is possible that the company paid a fine and obtained authorisation for the signboard; it is possible that after the first phone call, the administration simply did not care enough to pursue the matter; and it is also possible that some more private arrangement was made and that the phone call was a performance put on for my benefit and that at the same time served to increase leverage on the company. This minor example illustrates the local authority’s potential for using state regulations for private means. The administration in Oshikango had to start from scratch only a few years ago. With its limited resources, it has to confront an almost infinite choice of areas to regulate. As long as the town is seen to be doing something, nobody can blame the administration for not doing everything at once. This situation is perpetuated by the rapid changes in a boom town; it creates the possibility to combine bureaucratic domination with a higher degree of arbitrariness than would be possible in other settings. In a perfectly bureaucratic administration in the Weberian sense, the administration’s scope would be limited to applying the existing regulations.26 Oshikango in the boom situation is far from being perfectly bureaucratic. Even the highest-minded administration would have to set priorities, regulating certain areas and neglecting others. So while the town’s administration may not be able to openly act against national law, it is relatively free not to enforce an existing regulation. This gives important additional power to the few people who run the administration. Without precedents, they can set standards and create facts by regulating certain aspects of public life and disregarding others, and thus create a public order that will frame future decisions: situational power is transformed into structural domination.27 The hidden arbitrariness of the administration’s decisions increases the importance of an accompanying discourse on development and transparency, which can serve publicly to justify the administration’s choices and is a further link between the local and the national level. Without the rhetoric of development and modernity surrounding it, Northland City would surely have drawn greater public criticism from the start. Yet this is not to imply that those involved used such concepts cynically; Northland City was more than an attempt by Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 politicians to benefit economically from political connections. The national politicians involved in the project believed in its feasibility and its prospects for success. They shared the modernist vision of big development and the dream of participating in development through consumption, and they lost real money when the project failed.

Conclusion

Oshikango is both the youngest and the most dynamic boom town in northern Namibia. Unlike the cases of Katima Mulilo or Rundu, the other major towns along Namibia’s northern border, its development was not triggered from above, by political intervention and planning, but from below, through economic opportunity. In the first part of this article, I have traced the conditions of Oshikango’s economic boom. The town’s position on the border is, of course, crucial, making Oshikango easily accessible from both sides. If it depended only

26 M. Weber, Wirtschaft und Gesellschaft (Tu¨bingen, J.C.B. Mohr, Fifth Edition, 1976), pp. 122–30; 541–79. In Weber’s famous (and ironic) formulation (p. 565), the ideal administrator, like the ideal judge, would be an automat that generates sentences after being fed the facts. 27 For a seminal theoretical perspective on the institutionalisation of power, see H. Popitz, Pha¨nomene der Macht (Tu¨bingen, J.C.B. Mohr, 1992), pp. 232–60. Popitz identifies the de-personalisation of power, its formalisation and its integration into predominant systems of order as the most important mechanisms of the institutionalisation of domination. All three play a major role for the regulation on the town level. De-personalisation might always be a smokescreen for personal power, but it adds an important resource of legitimacy to that power. 130 Journal of Southern African Studies

on geography, however, the town would scarcely be more than a border stop on a highway today. The real driving force behind the boom is the separation of the administrative systems and social and economic networks that define trade into Oshikango – on the Namibian side – and out of Oshikango – on the Angolan side. The national regulatory frameworks of both countries make it necessary to de-register goods and persons in one country and to register them in the other. In other border posts – between Namibia and South Africa, for example – this is usually done by paperwork alone, without offloading or repacking the goods. Namibian and Angolan economic networks, however, are still very much separate, and business rules are perceived to be very different on both sides. Integrated trade networks lead from Mumbai, Shanghai or Glasgow to Oshikango, but the transit into Angola is assured by different, Angolan trade networks. So Oshikango is the transit point between two countries, two sets of regulations and two business spheres, a combination that has turned the town into one of the region’s most important trade entrepoˆts. State regulation has thus only played a passive role in the boom. It has unwittingly provided its structural conditions, but it has not initially influenced its emergence through political intervention. Very soon after the boom started, however, state institutions have tried to appropriate, advance and regulate it. The most important early interventions were the drawing of an urbanisation plan in 1996 and the donor-financed establishment of an Export Processing Zone and an EPZ park in 1999. Local regulation only gained real momentum with the installation of Helao Nafidi Town in 2004, however. The appropriation of the economic boom by the local administration has been at the centre of the second part of this article. The state’s institutions have tried to channel Oshikango’s development and to impose a set of regulations to transform the boom situation into a situation of ‘normal’, controllable growth. In the actions of local administrators, these official goals intertwine with more personal objectives, and the official role as a state representative is often used as a resource for unofficial actions. I have attempted to describe how this double face of administrative actions is typical of the relationship between state power and individual interests within the Namibian administration. In the literature on African states, the appropriation of the state apparatus by individual Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009 interests is often seen as a sign of weak institutionalisation of bureaucratic domination. There are two main variants of this: in the more conventional political science literature on failing states, the state’s institutional interests and the interests of individual actors are seen as opposing and mutually exclusive. In the alternative framework of neopatrimonialism, bureaucratic institutions are described as no more than an empty shell providing selfish actors with legitimacy and access to resources. The Oshikango case does not fit either of these models. There is a large scope for selfish actions by local officials. The source of their power, however, lies in their relation to the state and their backing by official structures. In order to act selfishly, they have to pretend that they are acting in the state’s interest, and to stick to the rules of bureaucratic domination. In doing so, they reinforce the expectation that state institutions will act according to these rules. So the state in Oshikango, as in many other small Namibian towns, is neither a ‘shadow state’28 nor a mere neo-patrimonial access point to resources. It regulates public life in the town with increasing effectiveness, and the source of this effectiveness is a specific combination of administrative self-interest and state capacity. The new bureaucratic elite are transforming political connections and administrative power into business benefits. State domination is their power base, and the more they increase the state’s reach, the more stable this power base becomes. So their interest in expanding the state’s reach is both concrete and

28 W. Reno, Corruption and State Politics in Sierra Leone (Cambridge, Cambridge University Press, 1996). The Dynamics of Growth and Regulation 131

tangible; at the same time, it is complemented by a modernist vision of development that favours bureaucratic, formalised solutions and sees the state as an important factor for channelling economic change. They clearly realise that they can only thrive as long as the town thrives. If they make the impression of either being incapable or of being too greedy, they risk losing their office and with it their access to resources. In such an environment, state domination is not – according to Bayart’s famous image – a rhizome that can shoot up at unexpected places.29 Rather, state domination is openly present, and the hidden rhizomes that can take root under the ground are private interests. As long as private interests remain hidden, the new generation of local administrators in Namibia will find more opportunities for private benefit by increasing the state’s reach. Administration in Oshikango has been successful in providing public goods. By doing their job, administrators can stay in power, can advance their careers, and can create new opportunities for making exceptions. These exceptions from the rules come with a higher price tag for the beneficiary (in cash, kind, or favours) if the rules are firmly established. In Oshikango, and in some other middle range Namibian towns, the state is most efficiently appropriated by selectively enforcing its rules. Two structural conditions provide administrators with the necessary incentives for this behaviour. First, Namibian media, civil society and, importantly, the judiciary are very sensitive about corruption and the misuse of office, making it necessary for officials at least to appear to maintain standards of good conduct. Secondly, in Oshikango – as in Katima Mulilo, Rundu, Walvis Bay or Windhoek – the resource base of state power lies in productive economic activity, not in rental income. Where there is real economic activity to regulate, state administration cannot become too oppressive without destroying its own ability to provide public goods and to channel access to patronage. So while the boom situation on the border of two countries makes regulation difficult by accelerating economic change, the economic opportunities behind the town’s boom have, by linking scope for selfish actions to the rules of state bureaucracy, also enhanced the development of an efficient administration in the town. In Oshikango, there is much economic activity outside the state’s sphere of regulation – and that may make all the difference for state regulation. Downloaded By: [Dobler, Gregor] At: 11:13 31 March 2009

GREGOR DOBLER Ethnologisches Seminar der Universita¨t Basel, Mu¨nsterplatz 19, CH-4051 Basel, Switzerland. E-mail: [email protected]

29 J.-F. Bayart, L’Etat en Afrique: La Politique du Ventre (Paris, Fayard, 1989).