Namibian Economics to the point - November 2018 - Namibia Safari and Lodges - Gondwana Collection

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Gondwana's Newsroom

Namibian Economics to the point - November 2018

Avatar of inke inke - 30. November 2018 - Economics


Brigitte Weidlich

November was a hot and dry month with only a few rain showers. The Hosea Kutako International Airport will receive N$245 million for upgrades, while petrol and diesel prices increased by 50 cents and 70 cents respectively. Some N$2.7 billion investment by a Swiss company will go to a steel rebar factory at Otavi. The Rössing uranium mine in the Erongo Region, will be sold to China. Government will re-introduce rent control. Namibia slipped slightly in the World Bank’s latest Doing Business report from rank 106 to 107 out of 190 countries. Namibia’s inflation rate rose to 5.1 percent in October, up from 4.8 percent in September, the National Statistics Agency reported this month.

News from the mining sector

The Anglo-Australian mining giant Rio Tinto Group will sell its 66.62 percent ownership in Namibia’s Rössing uranium mine to the Chinese state entity China National Uranium Corporation (CNUC) for about N$1.5 billion (approx. 98 million Euros). The deal will depend on consent from Namibia’s Competition Commission (NaCC), Rio Tinto said on 26 November. The Rössing uranium mine started production 42 years ago in 1976 and is the world’s longest running open-pit mine. Other shareholders are Iran’s Foreign Investment Company (15.22%), South Africa’s Industrial Development Corporation (10.22%), the Namibian government (3.38%) and individual shareholders (4.63%). The mine produced 2.110 tonnes of uranium oxide (yellow cake) in 2017.

China already owns ninety percent of the adjacent Husab uranium mine, after buying out the shares of the owner, Australian company Swakop Uranium a few years ago. Ten percent is owned by Epangelo Mining, a company of the Namibian government. Recently, China also acquired twenty-five percent in the Australian company Paladin Energy, which runs Langer Heinrich Uranium (LHU) in the Erongo Region near Swakopmund. 

Graphite mine temporarily closed

Namibia’s only graphite mining operation, which started production near Otjiwarongo in 2017, was put under care and maintenance. Some 128 employees were laid off by 30 November. The mine will re-open once graphite prices improve. Gecko Graphite jointly belongs to Imerys and Gecko Namibia. The mine produced 2.216 tons of graphite flakes last year, which was exported to Turkey, Germany and Slovakia. 

Steel factory gets N$2.7 bn boost

The Swiss company Noric, has secured funding of N$2.7 billion (about 172 million Euros) from a local bank for the envisaged rebar steel factory. Otavi Rebar Manufacturing will buy scrap metal to smelt it at its Otavi plant to produce rebar steel for the construction industry. Annual production is envisaged to be around 300,000 tonnes. NORIC Swiss GmbH has established a subsidiary, NORIC Otavi, which is a shareholder in the Namibian company, Otavi Rebar Manufacturing. The next step is to build the steel plant in the 77-hectare land provided by the Otavi municipality. Some 350 jobs will be created.

N$20 million for development bank

The Bank of Namibia has agreed to provide the Development Bank of Namibia (DBN) with a loan facility of N$20 million (1.3 million Euros) for small and medium enterprises (SMEs). The DBN will in turn provide more loans to these enterprises. “SMEs are a very important part of the Namibian economy and they need access to finances in order to prosper and grow”, said DBN Chief Executive Michal Inkumbi. The DBN has also started a joint venture capital fund to enlarge its lending capacity.  

France provides water master plan

The French government has signed an agreement with the municipality of Keetmanshoop for N$12 million (about 765.000Euros) to improve the water supply. A French environmental engineering consultancy will entail a diagnostic analysis of water management and the related infrastructure compiling a master plan for the water distribution over the next twenty years for Keetmanshoop.

N$245 million for international airport

Experts of the ICAO (International Civil Aviation Organisation) completed an audit of all airports in Namibia by 30 November. All airports passed the ICAO security audit. After a first N$95 million (about 6 million Euros) for the Hosea Kutako International Airport in October, another N$150 million (about 9.6 million Euros) will be set aside for further extensive upgrades and renovations. “While the N$95 million was funded from the Namibia Airport Company’s own resources, the N$150 million will come from the government,” says Leake Hangala, the new NAC board chairman. This will include the latest technology and software systems for closed-circuit surveillance, self check-in machines, passenger and luggage screening.  Some architectural improvements will also be done. 

No plastic bags in nature parks

The Ministry of Environment (MET) has implemented a ban on plastic bags in game parks and nature reserves on 22 November with immediate effect. Announcing the ban at the Daan Viljoen Nature Reserve outside Windhoek, Minister Pohamba Shifeta said contravention will result in a fine of N$500 (about 32 Euros) or up to six months imprisonment or both. Staff from the MET will search all visitors at entrance gates to the parks. Only see-through, re-sealable plastic bags, refuse bags designed for waste removal and samplings bags (for research) are allowed in.

Environment Ministry halts timber logging

After media reports of large-scale timber logging of teak and rosewood in the regions Zambezi and Kavango East and West, which is shipped through Walvis Bay to China, the Environment and Tourism Minister stopped all operations on 26 November. This was done in cooperation with the Ministry of Agriculture, whose forestry officials had issued over 160 logging permits. Environment and Tourism Minister Pohamba Shifeta officially informed Parliament a day later that it was discovered that none of the commercial loggers had applied for an environmental certificate at his Ministry. “This is a contravention of the Environmental Management Act,” the Minister said. All loggers must now apply for the certificate, but environmental impact assessments must be conducted before applications are submitted.

Wild horses remain tourist attraction

The feral horses in southern Namibia remain a big tourist attraction and must be preserved, according to the Ministry of Environment and Tourism (MET). Recognising that hyenas are threatening the existence of these horses, the MET plans to relocate the hyenas, the Ministry’s spokesperson Romeo Muyunda says. The Wild Horses of Namibia Foundation this month appealed to the MET to act urgently after all four foals that were born recently were killed by hyenas. “These horses are a big drawing card for tourists,” Muyunda added.

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