Mining still contributes billions despite global challenges

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Edgar Brandt
Windhoek

It is commendable that during 2016 the local mining industry was able to generate N$25 billion to contribute to the State Revenue Fund. This feat was achieved despite depressed global commodity prices and despite volatile financial markets.
This was said yesterday by Minister of Mines and Energy Obeth Kandjoze when he officially opened the sixth annual Mining Expo and Conference at the Windhoek Showgrounds yesterday. The Mining Expo and Conference runs until today and is open to the general public free of charge.

The theme for this year’s Expo is ‘Reaping the Benefits of Mining Investment in Namibia’. Despite the industry’s solid performance in the face of global challenges, Kandjoze noted that it is “disheartening” to see the level of participation of Namibians in domestic mining activities.

Mentioning that the majority of Namibians are structurally excluded from benefiting from the mining economy, Kandjoze said the New Equitable Economic Empowerment Framework (NEEEF) is an opportunity to change the status quo.

“The Draft NEEEF Bill has been submitted to the Office of the Prime Minister, whereafter it will still be subjected to legal scrutiny and then will be submitted to Cabinet for final approval. This entire process should take between four to six months,” Kandjoze said.

According to the president of the Chamber of Mines, Kombadayedu Kapwanga, who was present at the Expo opening, the chamber has been actively involved in private sector consultations with government regarding NEEEF.

“The chamber formally made submissions to the Law Reform and Development Commission and to the Office of the Prime Minister in August 2016. The outcome of NEEEF is still uncertain, though we have it in good faith that government is cognisant of the sector’s concerns with the current version of the Bill,” Kapwanga said on Tuesday evening during the Chamber’s annual general meeting.

During his presentation at the AGM, Kapwanga said the chamber is concerned that the continued uncertainties around NEEEF will further worsen Namibia’s rankings in the Frasier Institute reports.

“We therefore wish to appeal to government to expedite this matter to ensure an amicable outcome as soon as possible. The chamber hopes that government will adopt the constructive alternative proposals in NEEEF, which accommodate market fundamentals of the private sector and growth thereof, while implementing effective and pro-growth empowerment mechanisms,” Kapwanga stated.

Preliminary statistics for 2016 from the National Statistics Agency indicate that the mining sector made a direct contribution of 11.1 percent to Namibia’s Gross Domestic Product, but contracted by 6 percent in real terms.

The contraction was primarily due to a decline in diamond output and base metal production, specifically for zinc and lead.

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