Namibian Economics To The Point – December 2022

30 Dec 2022

The month of December brought welcome rains to several parts of Namibia and Windhoek experienced flash floods during a cloudburst.

Germany’s Minister for Economic Affairs and Climate action Robert Habeck officially visited Namibia before proceeding to South Africa for the Germany-Africa summit.

Germany has provided two loans worth 980 million Euros (approx. N$16 billion) for water and road projects.

President Hage Geingob was one of the 49 African heads of state who attended the US-Africa summit in Washington on invitation of the US president Joe Biden.

After a two-year absence, the revived airline South African Airways (SAA) has resumed flights to the Hosea Kutako International Airport outside Windhoek in December. SAA has now introduced two daily flights between Windhoek and Johannesburg.

Namibia’s Cabinet has approved the introduction of 5G technology for mobile telecommunication. The first 5G spectra offers for service providers to buy, are planned for March 2023.

Namibia has adopted the SSD standards of the International Monetary Fund (IMF).

The national inflation rate stood at 7.0% on 30 November, according to the National Statistics Agency (NSA), (October: 7.1%.)

German Minister Robert Habeck in Namibia

Germany’s Minister of Economic Affairs and Climate Action Robert Habeck arrived with a large business delegation in Windhoek in the evening of 4 December 2022 and the next morning had a short meeting with President Hage Geingob at State House. President Geingob also welcomed the approximately forty German business representatives in the large conference hall on the ground floor.

Geingob and Habeck, who is also Germany’s Vice-Chancellor, witnessed the signing of a cooperation agreement between Namibia’s Competition Commission and its German counterpart, the Bundeskartellamt. This was in lieu of upcoming green hydrogen projects in the country. The second agreement was for a grant to kick-start a green hydrogen smart village to be constructed near Uis in the northeastern Erongo Region.

President Hage Geingob and Germany’s Economics Minister Robert Habeck pose with the German business delegation at State House.
Photo by: German Economics Ministry

Habeck also met the Namibian Green Hydrogen Council, "I have never seen such a large German (business) delegation in Namibia" said President Hage Geingob spontaneously when he greeted Habeck. Both had already met in February at the World Economic Forum in Davos, Switzerland.

"We want a new kind of cooperation for the future (with Germany) regarding climate change and development for green hydrogen," Geingob said. Habeck said, if it was desired Germany would support Namibia to develop clean, reliable and cheap renewable energy sources. “If Namibia then generates a surplus of these energy sources, we would be very happy to import these products (green ammonia)," Habeck said.

New water recycling plant for Windhoek with German loan

Finance Minister Iipumbu Shiimi signed two loan agreements totalling 980 million Euros (approx. N$16 billion) with the Namibian representative of Kreditanstalt für Wiederaufbau (KfW), Beatrice Lucke.

About 40 million Euros (N$746 million) will be allocated for a new water treatment plant for Windhoek. This is expected to increase the capital's volume of recycled drinking water from some 25 percent to about 50 percent. The €50 million (about N$932 million) loan will support NamWater to renew parts of the bulk water pipelines at Schwarze Kuppe near Swakopmund, repair the water canal at Oshakati and enlarge the water treatment plant at Katima Mulilo.

The construction of more than 1,800 km of roads in Namibia has been co-financed by KFW in close cooperation with the Namibian Government since independence from the German government, the joint press statement said.

In addition, a loan of 20 million Euros (about N$373 million) was signed for the renovation of the very busy trunk road between Karibib and Usakos. This narrow section of road is 33 kilometres long and will be resurfaced and widened.

Work there is scheduled to start in mid-2023, with the involvement of Namibian companies.

Namibia now subscribes to IMF’s data standards

Namibia has subscribed to the International Monetary Fund’s special data dissemination standards (SDDS), becoming the fifth country in sub-Saharan Africa to reach this goal. The IMF announced on 15 December that by subscribing to the SDDS, Namibia graduated from the enhanced general data dissemination system (e-GDDS) it applied since June 2016.

“I congratulate the Namibian authorities on the subscription to the SDDS. It underscores Namibia’s strong commitment to transparency and is a significant achievement in implementing internationally accepted best practices in statistics and data dissemination, noted Bert Kroese, chief statistician, data officer, and director of the IMF’s statistics department.

“As IMF research showed, the implementation of the data dissemination standards, including subscription to the SDDS, was associated with a significant improvement in countries’ sovereign financing conditions”, Kroese added.

The SDDS, established by the IMF in March 1996, guides members in the dissemination of economic and financial data to the public. Subscription to the SDDS enhances the availability of timely statistics according to an advance release calendar, thereby contributing to sound macroeconomic policies and the proper functioning of financial markets.

First batch of 25 donated vehicles from EU handed over

The EU ambassador to Namibia Sinikka Antila, officially handed over eleven 4x4 off-road vehicles valued at N$6,35 million (about 350,495 Euros) to the Ministry of Agriculture, Water and Land Reform a few days before Christmas. The vehicles are procured by local suppliers under the Livestock Support Programme (LSP) for monitoring the northern communal areas of Namibia, funded by the EU through the eleventh European Development Fund (EDF 11) totalling 20 million Euros (about N$360 million).

Agricultural Minister Carl Schlettwein, (C) and his assistant (L) receive the keys from EU Ambassador Sinikka Antila (R) for 11 donated off-road vehicles.
Photo: Agriculture Ministry

The overall objective of the LSP is to enhance the livelihood of livestock farming communities in those areas north of the veterinary fence in a sustainable way, while improving the performance of the livestock value chain there. Agriculture Minister Carl Schlettwein received the vehicles and said that Namibia and the EU were partners since Namibia exports approximately 9,000 tons of beef from free-range cattle to European countries.

The remaining fourteen vehicles including five 30-ton trucks with trailers will be delivered in early 2023.

Chinese buy into tantalum projects

A Namibian subsidiary of China’s HeBei Xinjian Construction Group has in December signed off secured supplies of tantalum pentoxide concentrate from an Australian mining project in southern Namibia and bought out another tantalum project nearby. The Swanson mine is situated about 30km south of the Warmbad settlement near Karasburg.

The mining company Arcadia will also deliver lithium oxide with a minimum of one percent metal content, it announced. In return, HeBei Xinjian will invest into the mine and construct a tantalum concentrate and a lithium concentrate plant on site.

Tantalum is highly sought after for the production of electric components like lithium batteries and for electric vehicles.

The Chinese company has already secured another tantalum supply in the area with the British company Kazera Global. In July, they agreed to invest approximately seven million Euros (about N$127 million) in return for a 49 percent interest in lithium offtake from the Homestead Tantalum & Lithium Mine close to the Swanson mine. The area is referred to as Tantalite Valley.

On 20 December 2022, Kazera announced that they agreed to sell 100 percent of their Namibian tantalum and lithium mine to Hebei Xinjian for 13 million US$ (about N$226 million).  

Brigitte Weidlich 

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