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Sunday 20 January 2019
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Namibia turns to commodities to industrialise

Government says there is a case for commodity-based industrialisation, despite the current slowdown when it comes to interest commodities. Finance Minister, Calle Schlettwein, during one of his interventions at the Invest in Namibia Conference, said estimates put Namibia’s infrastructure funding gap at some N$50 billion by 2015 coupled with large deficits that exist in social sectors. “There is a case for commodity-based industrialisation for Namibia in areas of competitive advantages,” the minister told conference delegates. The economy may be relatively diversified, but mineral commodities make up over 50% of exports, something which has prompted local economists to constantly pressure Government to diversify the economy.
According to Schlettwein: “There is price-induced production slowdowns for some metal commodities and meat processing led to slowdown in overall manufacturing output. Uranium production is expected to raise beneficiation activity.” The minister also indicated that although the share of manufacturing has steadily risen, low commodity prices have impacted on beneficiation activity. Namibia is a net exporter of capital, a situation blamed on high institutional investment savings.
“The economy experiences savings-investment gap, exacerbated by capital flight. Domestic Asset Requirements prescribe that 35% of total assets be invested locally and about 1.75% so invested be in unlisted assets,” he said. He revealed that the 35% threshold is now being lifted gradually to about 45-50%, a move that is expected to release about N$9.47 billion in the economy annually over the next four years. Government wholly owns numerous state-owned enterprises (SOEs), in economic, financial and social spheres but returns from the SOEs are lower than expectations.
“Some of the economic and financial SOEs are credit-rated and can raise own funding in execution of their mandates. Partial listing of some of the SOEs offers opportunities for improving efficiencies and financial returns, while relieving reliance on the budget for project financing,” Schlettwein said. More than 1 700 participants, approximately 400 of them drawn from across Africa and abroad participated in the two-day Invest in Namibia Conference that ended on Wednesday. The various countries represented included Australia, Japan, Chile, France, Germany, Ireland, Mozambique, Spain, Belarus, Serbia, China, the UK, Turkey, Brazil, Finland, Sweden, Canada, Angola, Israel, Portugal, Nigeria, Hungary, the United States of America, Korea, South Africa and Zimbabwe.
The Conference consisted of four important components namely the Conference, Made in Namibia Expo, a Project Centre presenting 13 investment projects by Namibian project promoters and a Business to Business (B2B) meeting platform.  The conference programme covered seven plenary and six breakaway sessions over the two days, addressed by 67 local and 21 international speakers including ministers, industry experts, senior government officials and private sector representatives.




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