Namibian Economics To The Point – November 2020

30 Nov 2020

Brigitte Weidlich 

At the time of writing the N$/Euro exchange rate was: 18.27 = 1 Euro 

Hot summer weather prevailed during November with only little rainfall recorded. Weather experts however predict a good rainy season over the coming months.  

The secretary general of the United Nations World Tourism Organisation (UNWTO) visited Namibia in support of tourism revival, followingthe adverse impact of the Covid-19 pandemic on the sector. He declared that Namibia was a safe destination for tourists and that the prescribed health and safety measures should be continued. 

Namibia will make a down payment of N$26.4 million (about 1.44 million Euros) in early December to the international Covax vaccine distribution centre. In this way, Namibia will secure Covid-19 vaccine doses for about twenty percent of its population. The government has established a high level task force to investigate if cannabis could be legalised for medicinal purposes. 

The government launched a N$500 million (about 27,3 million Euros) loan scheme to assist small companies that have been hit hard by the Covid-19 pandemic. 

Namibia’s hake trawl and long-line fishery sector has become the first fishery in the country, and the second in Africa, to be internationally recognised for sustainable fishing by the Marine Stewardship Council (MSC). 

A government-owned abattoir in Oshakati, which stood idle for four years, has been renovated and handed over to a local company, which will run it together with a Chinese company. 

The inflation rate stood at 2.3 percent at the end of October (September: 2,4%), according to the National Statistics Agency. 

Top UN tourism official visited Namibia 

The Secretary-General of the World Tourism Organization (UNWTO) has paid a first visit to an African Member State since the start of the Covid-19 pandemic. During his three-day official visit to Namibia, Zurab Pololikashvili reaffirmed the UNWTO’s commitment to the continent. He held high-level talks with government representatives and the private sector in the tourism industry. Pololikashvili visited several of Namibia’s most famous tourism hotspots like Sossusvlei and the Namib Desert.  

As the United Nations specialized agency for tourism, UNWTO has been actively guiding the sector’s recovery and restart from the Covid-19 pandemic. This official visit offered a first chance to follow up on virtual meetings and advance the preparations for the restart of a sector upon which millions of African livelihoods depend. 

"Tourism is the best facility to create new jobs which are highly needed by Africans and we can do this step by step, with great will and patience”, said Pololokashvili. “Namibia is very diverse and we want to share with the world why they have to visit Namibia. We are pleased to show the whole world that even small nations can do a lot for tourism," he said.  

He also announced that Namibia will host the UNWTO Africa tourism branding conference next year.  

Pololikashvili also met President Hage Geingob and discussed the potential of tourism to drive sustainable development, including for youth, women and rural communities . Additionally, the UNWTO delegation met with the Minister of Environment, Tourism and Forestry, Pohamba Shifeta. Their talks focussed on growing the country’s tourism sector, including a greater focus on gastronomic tourism, rural and community-based tourism. Pololikashvili officially opened the annual Tourism Expo in Windhoek. 

Hake fishery obtains sustainability certificate 

The Namibia hake trawl andlong line fishery has become the first fishery in the country, and the second in Africa, to meet the globally recognised standard for sustainable fishing set by the Marine Stewardship Council (MSC), an environmental authority. 

The certification was announced on 17 November and recognises progress made by the Namibian government and fishing industry in rebuilding hake stocks, which in the past were decimated by overfishing by foreign fleets prior to independence.  

To be MSC certified, a fishery must show the fish stock is healthy, that it minimises its impact on the environment and has an effective management in place. 

The international certification will ensure the fishery can continue to export to markets in Southern Europe and will help it expand into retail markets in Northern Europe. Supermarkets and brands in these markets often prefer the fish and seafood they stock to be MSC-certified. 

The Fisheries and Marine Resources Minister, Albert Kawana said Namibia has worked hard to rebuild hake stocks that were historically overfished. MSC certification of the ‘Namibian Hake’ is an independent endorsement that efforts are working, and a signal to retailers, brands and fish lovers around the world that Namibian Hake is sustainable and it is here to stay. 

The Namibia Hake fishery, which operates on a much larger scale than many fisheries in the southern hemisphere, will supply up to 160,000 tonnes of sustainable hake per annum.

 

Fishing is the third largest sector of Namibia’s economy, with the fishing of hake making up the majority of the sector and directly employing more than 10,000 people.

N$500 million loan scheme for small businesses

The Covid-19 pandemic and lockdown regulations have also affected businesses in Namibia. In order to support small and medium enterprises (SMEs)Finance Minister Ipumbu Shiimilaunched aN$500 million (about 27,3 million Euros) Covid-19 SME loan scheme this month. 

Namibia’s central bank has made available N$500 million to fund the scheme, which can be accessed through the participating commercial banks in the country. The Bank of Namibia provides the money to the banksat the current repo rate of 3.75 percent.  

Through this sscheme, participating commercial banks will thus be able to extend loans to qualifying SMEs at the prime lending rate, which now stands at 7.50 percent. The obligation to pay interest and capital on these loans will be deferred for six months from date of the first drawdown. The loans are repayable over five years. Qualifying SMEs can cover certain fixed costs and working capital. 

Shiimi said to qualify for the Covid-19 loan scheme, an SME must prove it is adversely impacted by the lockdown; demonstrate that it has insufficient normal borrowing capacity to fully fund its monthly operating expenses; be a registered business entity, have an annual turnover not exceeding N$10 million (about 547,000 Euros) per annum; be in good standing with their bank prior to the onset of the Covid-19 pandemic in Namibia on 1 March 2020, and be registered with the Receiver of Revenue.  

Oshakati abattoir re-opened with Chinese partner 

The government abattoir at Oshakati in north-central Namibia, which has been closed since 2016 has been renovated and is back in business together with a Chinese business partner. 

The Eloolo abattoiris now managed and operated by KIAT Investments Holding and the Chinese company Ningbo Agriculture Investment Group. 

It now has 50 permanent employees and when in full swing this will increase to employ 80 workers permanently. The abattoir will also enable the export of beef from northern Namibia to China. The Minister of Agriculture, Water and Land Reform, Calle Schlettwein said at the official opening, that the government has renovated other northern abattoirs in Outapi, Oshakati, Eenhana and Katima Mulilo. “Government is constructing a meat processing facility each at Ongwediva and Bukalo,” he said.