Namibian Economics To The Point - July 2021

30 Jul 2021

AUTHOR: Brigitte Weidlich

July brought very cold temperatures in the inland and several spells of hot east wind weather along the coast. Covid-19 infections have significantly dropped in the second half of this month. Health Minister Shangula stated that the peak of the third wave had been reached.

In Windhoek, the private sector has started two drive-through Covid-19 vaccination centres, which will ease pressure on other vaccination centres.

The South African Foreign Minister, Naledi Pandor, assured Namibia that no supply shortages from South Africa would occur due to the looting and destruction of shops and factories earlier in July, in two South African provinces. Pandor was on a business visit to Namibia to discuss further trade possibilities between the two neighbours among other things.

The company Namibia Media Holdings (NMH) has cancelled its annual tourism expo, which was planned for later this year. Similarly, the Chamber of Mines cancelled its annual mid-year mining expo, but will hold its annual mining conference in September; however, it will take place virtually.

President Hage Geingob appointed an eight-member-strong task force of information technology experts to investigate how Namibia can prepare for and benefit from the fourth industrial revolution (4IR).

Fish fillet has become a major export commodity that has brought in more than N$1,2 billion (about 70.5 million Euros) of export earnings for Namibia between January and March this year. This was revealed by the statistics authority.

Namibian beers won awards at an African beer competition.

The inflation rate stood at 4.1 percent at the end of June (May: 3.8%), according to the National Statistics Agency.

Economic growth of 2.1 percent predicted for this year

A local investment company predicts that Namibia’s economy will grow by 2,1 percent this year. The head of research at Cirrus Capital, Robert McGregor noted that low diamond production, slow vaccine rollout, and the impact of COVID-19 restrictions on key sectors slowed growth. McGregor however emphasized that the local economy will is expected to grow 3,2 percent next year.

According to the company’s latest economic outlook report, mining will drive the growth, particularly diamond production. A De Beers subsidiary, Debmarine Namibia, will receive its new mining vessel in 2021. This vessel has a production capacity of half-a-million carats through seabed mining per annum. The outlook report however noted that deep reforms across all sectors would be required to ensure that economic growth translates to positive social impact, like job creation and investments to reduce inequality following the COVID-19 pandemic.

First ever-mining license for rare earth metals

The Canadian company Namibia Critical Metals (NMC) has received a mining license from the Namibian government at the end of this month to mine rare earth metals, after several years of exploration at its Lofdal project west of Khorixas. The mining license is valid for 25 years until 2046. NMC announced that the Lofdal project has the potential for mining dysprosium and terbium, the two most valuable heavy rare earths, which are used in high-powered magnets.

“Our resource update on Lofdal puts the project unequivocally among the top heavy rare earth element projects in the world. It’s a fantastic position to be in”, said Darrin Campbell, president of NMC.

NMC will through its Namibian subsidiary, Namibia Rare Earths undertake the mining activities at Lofdal through a joint venture with the Japanese government company Japan Oil, Gas and Metals National Corporation (JOGMEC). This way, Japan will secure supply of these metals for its own economy. One of the conditions of the mining license is that twenty percent ownership of the joint venture will go to previously disadvantaged Namibians. Construction of the mining infrastructure will begin in due course. Rare earths are increasingly in demand for electric vehicles and other technological products.

New direction for meat industry under discussion

Various role players in the agricultural sector and organisations from the private sector had a virtual meeting with the Minister of Agriculture, Water and Land Reform, Calle Schlettwein about the growth of meat production. This encompasses beef, mutton, pork, poultry and potential for game meat.

South African foreign minister Naledi Pandor (L) came to Namibia for a working visit in July and discussed several topics with her Namibian counterpart Netumbo Nandi-Ndaitwah (R). Photo: Foreign Affairs Ministry

Among the topics discussed were a drought and re-stocking policy, optimal utilisation of slaughter capacity, the implementation of a grazing strategy and the debushing in areas of bush encroachment, to add more pasture areas for livestock as well as the review of laws and policies that adversely affect growth in this sector.

After the meeting, the Minister requested the Meat Board to compile a discussion document that will lead to the recovery and economic growth of the meat industry, to once again make a significant contribution to Namibia’s Gross Domestic Product (GDP).

This document is expected to be submitted in early August and will also include proposals for funding of the maintenance and repair of the veterinary cordon fence. This fence, also called the ‘red line’ prevents the spread of possible animal diseases like foot and mouth from communal areas, which would otherwise prevent meat exports to international markets like Europe, China and the US.

Namibian beers win at African beer competition

The company Namibia Breweries Limited (NBL), a subsidiary of the Ohlthaver & List (O&L) Group, received awards for various beers it produces at the 2021 African Beer Cup. The annual competition awards the best beers in Africa according to various categories. NBL took home a silver award in the Amber Malty European Lager category for its Urbock Beer.

Beer is an important economic sector in Namibia, here an aerial view of NBL’s brewery. Photo: NBL

The NBL owned craft microbrewery, Swakopmund Brewing Company in the Strand Hotel Swakopmund, received a gold award in the Strong European Beer category for its Urbock Beer as well as a bronze award in the Amber Bitter European Beer category for its Helles Bier. The SBC brew master, Ronn Rittmann said: “It is a joy for us to go through all the precise processes to deliver products that others in turn enjoy. This recognition spurs us to keep imagining, celebrating the craft, and striving for the best.”

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