Namibian Economics To The Point - August 2021

1 Sep 2021

By Brigitte Weidlich

A few warm days in-between cold winter weather in August with strong winds brought severe bush fires, which destroyed thousands of hectares in the Dordabis and Groot Aub area southeast of Windhoek. Fires also raged near the Daan Viljoen Park west of the capital.

A new subsidiary of the Lufthansa Group, Eurowings Discover now connects Frankfurt with Windhoek five times a week. A local company, Fly Westair now flies to Rundu from Windhoek.

Germany and Namibia officially signed memorandum of intent for a partnership to develop green hydrogen production in Namibia.

The international diamond company De Beers will support the renowned National Geographic Magazine to preserve and protect the famous Okavango River from its origins in Angola, along Namibia to the delta in Botswana.

The mobile communications company MTC will soon list on the Namibian Stock Exchange (NSX).

Namibia has exported over 160,000 tonnes of salt between April and August this year.

The graphic showing increased salt exports. Graphic: NamPort
The graphic showing increased salt exports. Graphic: NamPort

The central bank again kept its repo rate steady at 3.75 percent this month, being the 12th consecutive month.

Namibia’s inflation rate for July was 4.0% (June: 4.1%)

Since April, NamPort exported a total of 160,186 tonnes of (bagged and bulk) salt exported via Walvis Bay to various destinations, including West Africa. Photo: NamPort

Germany and Namibia partner in green hydrogen project

The Namibian government has signed a green hydrogen partnership agreement with Germany. The National Planning Commission Director General Obeth Kandjoze and Germany’s Research Minister Anja Karliczek signed the agreement in Windhoek and Berlin on 27 August during a virtual ceremony behind closed doors.

German Minister Anja Karliczek, said that both countries want to use green hydrogen for their energy needs. “I am proud that we are the first country to formally conclude a hydrogen partnership with Namibia,” she said. The federal ministry of education and research will provide up to 40 million Euros (about N$700 million) in funding for cooperation within the framework of this partnership. According to Karliczek has “enormous potential” for the start-up of a green hydrogen economy.

Wind speeds in Namibia make the generation of wind power particularly profitable. Solar energy would be another option since Namibia has more than 3,500 hours of sunshine per year. “That is almost twice as much as in Germany. We therefore assume that a kilo of hydrogen from Namibia will eventually cost between 1,50 and 2 euro. That would be a worldwide peak value that could become a huge locational advantage for hydrogen made in Namibia,” she said. Germany predicts it would require 1,7 million tones of green hydrogen annually by 2030 – excluding its refineries.

On his part, Namibia’s National Planning Commission Director General Obeth Kandjoze said, Namibia was particularly vulnerable to the impacts of climate change.

“We intend to provide funding for feasibility studies and pilot plants that will open up competitive solutions with cutting-edge technologies and leverage the potential for green hydrogen in Namibia identified by our scientists,” Kandjoze said.

Namibia aims to export green hydrogen before 2025, produced from solar/wind power and desalinated water from the Atlantic Ocean. Southern Namibia is a potential production site. Namibia expects to earn about N$800 million (some 46 million Euros) annually through green hydrogen exports.

Investments of up to N$6 billion (about 346,2 million Euros) are required, according to President Hage Geingob, who launched the project’s open bidding process for local and international investors this month.

Eurowings Discover implements flights to Namibia

The newest leisure airline of the Lufthansa Group, Eurowings Discover, completed its maiden flight from Frankfurt to Windhoek on 11 August. Eurowings Discover operates 5 weekly connections from Frankfurt to Windhoek, with return flights on Mondays, Wednesdays, Fridays, Saturdays, and Sundays.

From mid 2022, the leisure carrier will expand to daily flights with 3 weekly onward tag flights to Victoria Falls in Zimbabwe. Captain Wolfgang Raebiger, who is also the CEO of the new airline, operated the first flight to Windhoek. The plane was welcomed by an airport event and a delegation including German Ambassador Herbert Beck.

“In celebrating the launch of Eurowings Discover touching down for the first time on Namibian soil, not only are we making history today, but also offering our Namibian customers an opportunity to reconnect with their families and friends abroad, at very competitive fares,” Raebiger said. Travellers can choose between 2 classes and businesspeople are offered a sophisticated business class product.

Meanwhile other aviation news is that the local company FlyWestair has expanded its Namibian routes to Rundu in the Kavango East Region on 24 August. Two flights per week - on Tuesdays and Thursdays - depart from the Eros airport in Windhoek to Rundu.

Local mobile telecommunication giant to list on stock exchange

Namibia’s first and largest mobile telecommunications company (MTC) and currently wholly owned by the government, received the green light from the Namibia Stock Exchange (NSX) for its listing application. MTC will sell 49 percent to ordinary Namibians and retain 51% ownership. This will be the largest listing of a local company in the history of the NSX. The company prospectus will be released on 20 September with details about the cost of the shares, among others. Interested local buyers will be able to make bids from next month until early November. The official listing event is planned for the end of November. MTC is also the first government-owned enterprise to list on the NSX.

Local dairy production declines

The Namibia Agricultural Union (NAU) has warned that Namibia's dairy sector is in danger of collapsing. It said that milk production in the country has been on a drastic decline over the past 2 years - from 21-million litres in 2019 to 17 million litres last year. This year's production might drop by a further 5 million litres to 12-million litres per annum. Until the end of 2018, Namibia produced double that amount, being 24 million litres.

A dairy cow and a handler the Mariental Superfarm. Photo: Namibia Dairies
A dairy cow and a handler the Mariental Superfarm. Photo: Namibia Dairies

After two dairy farmers ended their production end of July, only seven producers remain operational, among them the dairy Superfarm just outside Mariental. Low milk prices paid by off-takers, cheap imported milk and dairy products and increased feed costs are some of the obstacles the sector is facing. Draft legislation to protect the local dairy industry is still awaiting finalisation.

De Beers to help protect famous Okavango River

The diamond company De Beers and National Geographic announced on 25 August the launch of Okavango Eternal, a five-year partnership to protect the source waters of the Okavango delta and the lives and livelihoods they support. The five-year project will help protect endangered species, ensure water and food security for more than one million people and develop livelihood opportunities for 10,000 people, the two companies explained.

The focus will be on protecting the natural world and supporting communities across Botswana, Namibia and Angola. This includes providing long-term wildlife corridor protection for the movement and proliferation of endangered species, supporting critical conservation research through funding expeditions to gather new data, installing monitoring technology and building capacity of local researchers through grants and training.

Water and food security for more than one million people along the total length of the Okavango River will be supported, while livelihood opportunities for 10,000 people will be developed and their resilience to climate-related impacts will be improved.



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