Articles on this Page
- 11/05/19--14:00: _Internal auditors a...
- 11/05/19--14:00: _China hypes import ...
- 11/05/19--14:00: _'Struggle' rhetoric...
- 11/05/19--14:00: _Navigating Namibia’...
- 11/05/19--14:00: _41% of Namibians wa...
- 11/05/19--14:00: _Councillor urges N$...
- 11/05/19--14:00: _Shadow of death
- 11/05/19--14:00: _Capture the consumer
- 11/05/19--14:00: _Nigeria puts squeez...
- 11/05/19--14:00: _Debt relief a doubl...
- 11/05/19--14:00: _New cocoa deals hel...
- 11/06/19--14:00: _A night of vengeance
- 11/06/19--14:00: _Dr Hage Geingob Cup...
- 11/06/19--14:00: _Hakimi seals stunni...
- 11/06/19--14:00: _Omulumentu a dhipag...
- 11/06/19--14:00: _Aailongi ya kondema...
- 11/06/19--14:00: _Ten arrested for wi...
- 11/06/19--14:00: _Women advised to av...
- 11/06/19--14:00: _No policy on Chines...
- 11/06/19--14:00: _New strategies need...
- 11/05/19--14:00: Internal auditors and protecting the public good
- 11/05/19--14:00: China hypes import show, but not everyone's buying it
- 11/05/19--14:00: 'Struggle' rhetoric won't work
- 11/05/19--14:00: Navigating Namibia’s regulatory seas
- 11/05/19--14:00: 41% of Namibians want land seized
- 11/05/19--14:00: Councillor urges N$76m Rundu bailout
- 11/05/19--14:00: Shadow of death
- 11/05/19--14:00: Capture the consumer
- 11/05/19--14:00: Nigeria puts squeeze on oil majors
- 11/05/19--14:00: Debt relief a double-edged sword for S. Africans
- 11/05/19--14:00: New cocoa deals help peasant farmers, but not enough
- 11/06/19--14:00: A night of vengeance
- 11/06/19--14:00: Dr Hage Geingob Cup fever
- 11/06/19--14:00: Hakimi seals stunning Dortmund win
- 11/06/19--14:00: Omulumentu a dhipaga aakwanezimo ye nekatana
- 11/06/19--14:00: Aailongi ya kondema ekateko miifuta yomailongo
- 11/06/19--14:00: Ten arrested for wildlife crimes
- 11/06/19--14:00: Women advised to avoid walking alone
- 11/06/19--14:00: No policy on Chinese engagements
- 11/06/19--14:00: New strategies needed for livestock sector
The reason is apparent as government is the single largest business entity, generating significant economic activity through its expenditure and various functions (Unegbu & Kida, 2011). Additionally, the government’s social and economic activities are in part funded by the public through taxes, which further validates the public’s demand for improved governance.
The golden question is, how does the role of internal audit aid in protecting the public interest?
According to the Institute of Internal Auditors (IIA), internal auditing is defined as “an independent, objective assurance and consulting activity designed to add value and improve an organisation’s operations”.
In dissecting the first part of the definition, it is key to note that “organisation” refers to institutions in both the private and public sector.
The definition further states that internal auditing “helps an organisation accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes”.
The latter part of the definition highlights internal audit’s responsibility in assessing and recommending improvements to governance, risk management and controls to ensure that these processes function efficiently and effectively.
Internal auditors evaluate processes to identify and report on areas of mismanagement, wasteful and fruitless expenditures.
Consequently, recommendations are made to either prevent or detect the malfeasance and ensure that proper corrective actions are taken. Through these evaluations and recommendations, internal audit can help public sector organisations manage their resources in the most impactful way, thereby achieving their objectives, and ultimately benefiting the public. Additionally, although it is not a direct responsibility, internal auditors may report on instances of fraud and corruption encountered during the course of their work.
In extension to identifying and reporting on malfeasance, internal auditors perform services to identify opportunities for optimisation, efficiencies and cost savings.
As citizens and funders of the government’s economic activities, poor governance and risk management directly affects our livelihood, economic and social standing (Chambers, 2019).
Internal audit is a cornerstone of good governance and is instrumental in helping public sector organisations achieve their objectives through its evaluation of and recommended improvements to governance, risk management and control processes. As a result, the government can reap greater returns on its economic activities which can be ploughed back into programs and activities that benefit society at large.
Linda Elago is the manager of internal audit at PwC Namibia. Contact her at firstname.lastname@example.org
Chambers, R. F. (2019, October 28). Internal Auditing and the Public Good. Retrieved from Internal Auditor Online: https://iaonline.theiia.org/blogs/chambers/2019/Pages/Internal-Auditing-and-the-Public-Good.aspx
Unegbu, A. O., & Kida, M. I. (2011). Effectiveness of Internal Audit as Instrument of Improving. Journal of Emerging Trends in Economics and Management Sciences (JETEMS), 2(4), 304-309.
President Xi Jinping opened the second annual China International Import Expo (CIIE) yesterday in Shanghai with a speech declaring - as he did last year - that the country would widen foreign access to its vast markets.
But surveys by European and American business associations have found that many of their members view the week-long fair, heavily promoted by Beijing, as of little use.
The European Union Chamber of Commerce released survey results on Monday in which only half of its members said their participation last year resulted in business agreements, and just a quarter of participating companies actually saw those deals fully "realised".
China says US$57 billion in deals were struck last year at an event portrayed as a way for foreign companies to find Chinese buyers for their goods and show Beijing's sincerity in levelling trade imbalances with many countries.
But the EU Chamber survey found that "too much emphasis had been placed on delivering quick, headline results".
"This lack of follow-through suggests pressure to create a positive public image of this event by promoting hasty signatures, rather than creating a sound environment for European companies to expand in China in the long-term," the chamber said.
Many companies who opted not to return this year cited "meeting bad contacts, [and] feeling 'cheated in different ways'," it continued.
Foreign businesses have long complained about crushing red tape, intellectual property theft and a playing field skewed in favour of Chinese companies.
"We expect this year's event to be supplemented by concrete measures to facilitate further market opening and increase foreign investment, not by empty promises that we have heard many times before," said Carlo D'Andrea, vice president of the EU Chamber, in a statement accompanying the survey.
A recent survey by the Shanghai arm of the American Chamber of Commerce in China found just 10% of member-companies saw participation this year as "very important", while 68.5% saw "no importance".
It added, however, that many of its members already manufacture within China and have little to gain from an import show.
Organisers say more than 3 000 enterprises from over 150 countries are attending this year's expo.
The state run Global Times dismissed the criticism by the business lobbies, saying foreign companies were landing fewer orders in China because of rising competition from home-grown rivals.
"Some Western public opinions do not take CIIE seriously and regard it as China's 'political show'. This reveals little understanding of China," the paper said in an editorial yesterday.
"It has become increasingly difficult for foreign products to stay attractive to Chinese consumers, which all countries need to realise."– Nampa/AFP
Women also shade men 717 809 to 640 659 when it comes to registered voters. In the context of Southern Africa, where former liberation movements have ruled the roost while using their so-called struggle credentials, it is now time to start actively banging a different drum.
For the 400 000 youth who will potentially cast their votes on 27 November, what happened during the '60s, '70s and '80s will have little bearing on who they vote for. For them it is the reality that stares them in the face every morning when they step out of their shacks. This reality burns home even more searingly when they hunt for jobs. What has the ‘glorious’ struggle have to do with their plight? Perhaps it is only a reminder that what was once promised to their parents and grandparents has not yet been properly delivered; that things are “not yet uhuru”. This election gives these young people an opportunity to express themselves firmly on what must happen politically and economically over the next five years and beyond. For parties contesting for the youth and other votes this is a critical realisation: They cannot continue to campaign with what may or may not have worked with those that lived through apartheid. Something different needs to be cooked up in political kitchens by strategists and those who have sold themselves as vote-catchers for their different political formations. Also, in the context of the ruling party, past track records, even their most recent one, cannot simply be played, so that voters dance deliriously to the polls. These hungry and untrusting youth, brimming with knowledge they are spoon-fed every day via the internet and other mediums, are a different breed.
MdP: Coffee is always the first order of business! The rest of the day is taken up by various meetings with internal stakeholders to assist them to know and understand the compliance environment and to implement controls to ensure compliance with the various pieces of legislation governing the non-banking financial services world. Attending formal sessions with our regulators, industry bodies and our attorneys is also a big part of an average day at the office.
B7: How would you prescribe the prevailing economic landscape in Namibia and its impact on your industry?
MdP: Tough and very slow to improve. We operate in the tertiary sector of the economy. Given that the primary and secondary sectors are hard-hit by the current tough economic conditions, and many of our customers are from the primary and secondary sectors, this has a negative impact on both the quality and quantity of business secured in the insurance industry.
B7: Why is a healthy regulatory environment important in an economy?
MdP: A healthy regulatory environment creates a safe and certain environment within which both industry participants and their customers can conduct business, secure in the knowledge that everybody’s interests are adequately protected. It delineates the field of play and the rules of the game.
B7: How would you describe the prevailing regulatory environment?
MdP: It is in the process of evolving from a rigid rules-based system to a risk-based system – but we are not quite there yet.
B7: What are the major developments on the local regulatory front?
MdP: The three big developments (and they are closely related) would definitely be the impending Financial Institutions and Markets Bill, the new Namfisa Bill and the Financial Services Adjudicator Bill. Collectively these pieces of legislation will replace most of the current outdated non-banking financial services legislation and formally introduce a risk based supervisory regime for the industry.
B7: What is the anticipated impact on the industry?
MdP: On the one hand the increased volume and complexity of the laws to be complied with will have negative cost impacts, driven mainly by increased direct compliance costs and the system changes that would be necessitated to comply. It may also negatively impact customers’ experience to transact, due to more onerous transactional requirements.
On the other hand, though, it will introduce much needed professionalism and higher standards for all industry participants. Advice standards and transparency are expected to improve, which is great news for customers, but also for industry participants.
B7: Local assets managers are required to invest a sizeable chunk of their assets in Namibia. How much of its assets does Sanlam Namibia invest locally and in which asset classes?
MdP: Sanlam complies with all regulatory requirements in terms of domestic investments – for life insurers, currently the requirement is to invest at least 45% in domestic assets.
About 41% of Namibians want the government to expropriate land without any compensation, the latest Afrobarometer report has found.
This finding comes at a time when the lands ministry has asked attorney-general Albert Kawana for a legal opinion on the expropriation of land with just compensation.
The report further shows that 36% of Namibians want the willing-buyer, willing-seller policy to continue while 16% believe there is no further need for land reform.
The second land conference held in October last year resolved to discontinue the willing-buyer, willing-seller principle and to develop an accelerated land delivery method.
Under the willing-buyer, willing-seller policy, the government buys farms at market prices and has the first option to buy any farm offered for sale.
In 2018 the cabinet approved a recommendation that 70% of all future resettlement farms be reserved for war veterans and their dependants, while the rest of the beneficiaries must be drawn from the national pool of applicants.
Provision of land
The Afrobarometer report also says 58% of Namibians are somewhat satisfied with the effectiveness of the government’s provision of land and housing in urban areas, while 32% say housing provision is not effective at all.
The government has come under fire for the slow pace at which it delivers serviced residential plots, which has led to the uncontrolled growth of informal settlements.
The Shack Dwellers Federation estimates that close to 40% of Namibians live in shacks - amounting to close to one million individuals and 228 000 shacks countrywide.
The Afrobarometer report also states that the demand for land has been overtaken by drought and water supply as the most important problems Namibians want the government to address.
The Afrobarometer team in Namibia, led by Survey Warehouse, interviewed 1 200 adult Namibians in August 2019.
Rundu Concerned Citizens Association (RCCA) chairperson Reginald Ndara, who also serves as a councillor on the local town council, has called on government to bail out the cash-strapped municipality, which owes NamWater nearly N$76 million.
He says the local authority is on the verge of bankruptcy. Ndara made the call during a RCCA meeting on Saturday.
He argued that a huge chunk of the monthly income of the town council is being used to service the NamWater debt and pay for prepaid water, since the council was moved from the conventional post-paid system due to its debt.
He said because of this, the council is unable to focus on developmental projects and effective service delivery, as well as paying staff salaries on time.
Ndara said if the council is unable to provide services to its residents, as stipulated in the Local Authorities Act, chances are, it may be downgraded to village council status.
“The Rundu town council is sinking into debt, and sinking very fast, therefore we are strongly pleading with central government, specifically the line ministry, to bail out the Rundu town council, if not, then the possibility of it being declared bankrupt and insolvent is great,” Ndara said.
While making reference to the effects of water rationing, which is currently taking place in Rundu, Ndara questioned what will happen if the local authority is unable to pay for water.
“If one day without water is a serious concern already, imagine the situation where residents will be without water for three months or so. What a disaster and shame it will be,” Ndara said.
He also used the opportunity to call on residents to use water sparingly and pay their water bills.
“You might think it’s in your favour to owe the local authority money for water used, but in the long run, when there is no water, you will feel the pinch as well. There is no good derived from not settling your accounts,” Ndara said.
Rundu ratepayers owe the local authority over N$200 million.
Last month the cash-strapped Rundu town council threatened to suspend water supply to residents with overdue water bills.
However, weeks’ later Rundu mayor Isak Kandingu announced an incentive programme that will see residents and businesses apply to have their interest on municipal accounts in arrears waived.
The programme will run from 1 November to 30 June 2020.
Saturday’s meeting was also aimed at discussing the upcoming National Assembly and presidential elections, slated for 27 November, specifically how RCCA members will vote.
Ndara said yesterday they decided not to collectively rally behind any political party or presidential candidate.
He said they would vote according to their conscience.
The tragedy happened in the early hours at Epatululo village near Onhuno in the Ohangwena Region.
The 26-year-old man was arrested but his name cannot be published because he had not appeared before court yet.
He allegedly murdered his mother, Vilgenia Teofelus (61), his brother Simon Petrus (30), who was trying to rescue his mother, and his one-year-old niece Ndapandula Ndahalaovanhu Hafeni.
Another child, two-year-old Gift Rejoice Petrus, was grievously wounded when the suspect chopped off her left leg and two fingers of her left hand.
Not even the family's pets and livestock were spared. The man allegedly killed a dog and eight goats with the same panga before following the two surviving children to the neighbour's house.
The police say charges of murder, attempted murder and cruelty to animals are being investigated against the man.
The police reported that the three deceased had been hit on the head several times with a panga.
The body of the suspect's mother and brother were found lying on the ground within the homestead, while the two children were found in a bedroom.
“The motive behind the crime is not yet established but according his sister Olivia Petrus, the suspect told them that since Sunday he had been seeing lots of people surrounding their house.
He had been fighting these invisible people with the panga. The suspected murder weapon was found hidden at Okelemba village,” the police reported.
According to the police the seriously injured two-year-old girl was taken to the Engela district hospital, from where she was rushed to the Oshakati Intermediate Hospital.
The other two surviving children are currently in the care of a social worker.
According to their neighbour, Losalia Ndakalako, she woke up around 05:00 when the two children ran into her homestead screaming for help.
“When I asked them they told me that their uncle had attacked people in the house with a panga. They told me that he just entered the room where they were sleeping with their grandmother and took a panga from underneath their grandmother's bed before ordering them to leave the house. When they left their grandmother was attempting to take the panga from the suspect,” Ndakalako said.
“They left the house but the entrance was closed tightly so they had to climb over to escape. We took them into a room, but they were frightened and they could not stay on their own. I called the mother of these two children, who is in Windhoek, to call the police, but later we heard him [the suspect] come into our house looking for the two children. We locked ourselves into the room and he went away.”
Ndakalako said they were too frightened to leave the house and waited about an hour for the police to arrive.
According to the regional police commander, Commissioner Simeon Shindinge, officers responding to the call found the suspect walking in the road and arrested him.
“When we got the news we rushed to the area and a team was deployed all over the village and we managed to catch the suspect before we got to the house where it all happened. We found the three bodies lying all over the house,” Shindinge said.
“We learned that he had just come back home last week after spending some time away. We are suspecting that he abuses drugs and alcohol.”
This finding of the Roots 2019 Consumer Behaviour Survey is as applicable in Namibia as it is in South Africa, where the research was done, Lynne Krog, seasoned marketing and research specialist, says.
Speaking at a recent Business7 engagement, Food for Thought, Krog described the prevailing retail environment saying: “It’s a battlefield out there.”
When times are bad, less people are buying. And those people who are buying, are buying less, Krog says.
In an economy in its third consecutive year of recession, retailers in Namibia know that only too well.
The latest data by the Namibia Statistics Agency (NSA) shows that by the end of June this year, wholesale and retail spent 11 consecutive quarters growing negatively.
At constant prices, the sector’s contribution to the gross domestic product (GDP) has dwindled from 14.1% in the second quarter of 2016 to 11.6% in the same quarter of 2019.
Debt-ridden consumers are surviving on short-term loans, advances and credit cards, figures by the Bank of Namibia (BoN) indicate.
At the end of September, consumers’ personal loans and credit card debt at local commercial banks totalled nearly N$7.7 billion – about N$1.4 billion or 23% more than a year ago. Overdrafts exceeded N$3.4 billion, an increase of N$337 million or 11% within 12 months.
The latest statistics of the Namibia Financial Institutions Supervisory Authority (Namfisa) show microlenders’ total loan book at the end of the first quarter of 2019 stood at nearly N$5.8 billion, an increase of about N$850 million or 17.3% compared to the same three months in 2018.
Know your customer
The battle-scared consumer have the following characteristics – characteristics which retailers have to know and capitalise on to survive and grow in this tough market, Krog says.
“They’re more value conscious, so they’re looking for deals more. People are more fickle, so they’re going to be shopping across more retailers rather than just sticking to one. People are time-strapped and convenience driven.
“All this makes for a much more difficult environment for you to do business in,” Krog says.
It’s not just consumers at the bottom end of the market who are budget conscious and plan their shopping. The multi-million dollar research shows it is across the entire sample of LSMs - Living Standards Measures, a marketing and research tool used in South Africa and Namibia to classify standard of living and disposable income.
According to Krog, 88% of consumers in LSM 5 and 6 plan their purchases. This figure moves up to 89% for LSM 7 and 8. At the top end of the spectrum – LSM 9 and 10 – 90% of consumers now have a shopping plan.
Roots’ data show that people are buying less regularly than before. Those who buy clothes every two to three months or more often have dropped from 33% in 2013 to 25%. In comparison, those shopping for clothes every 4 to five months or every six to 12 months have increased from 51% in 2013 to 62%.
In the durable goods market the trend is even worse, Krog says. These market are “thinner”, meaning not very many people are in the market at any given time. “These are the industries that are going to be hit the hardest,” she says.
With more regular purchases, like coffee for instance, consumers will still buy, but they might cut their consumption. Maybe they’ll drink one cup of coffee per day instead of three, or start making it at home instead of getting take-out coffee, Krog explains.
An interesting phenomenon is the “lipstick factor”.
“When times are bad and you can’t afford a big holiday, you might treat yourself with smaller things like coffees coffees a day. Sometimes you actually see things like that picking up in bad times, but bigger, non-regular purchases tend to go down,” she says.
“The good news is that even when times are bad, life still happens. Things go on as normal – you’re fridge still breaks … things are still happening, they’re just not happening at the rate they did previously,” Krog says.
The trick is how retailers can tap into life that is still happening and get the sales that are still happening in order to grow.
“There’s this whole idea that you have loyal customers. They are loyal to you and they’re always going to shop at you.”
No true, says Krog: “You share your customers with other retailers, evidence shows. Always, you’re sharing. People aren’t loyal to you; you’re literally sharing.”
Her advice? Never rely on loyalty.
Evidence shows that even the retail group with the biggest market share has customers who shop elsewhere. “They shop at retail outlets according to market share.”
According to Krog, this is a very difficult trend to change. “It takes a lot of spend and a lot of hard work.”
Increasingly more consumers have loyalty cards. Research shows this has increased from 52% in 2016 to 72% currently, Krog says. “Also: more people have more loyalty cards.”
Retailers may think this is a good development as more consumers are “loyal” to their brand.
“Actually no, this just means that there are a lot of clever shoppers out there because they use the loyalty cards to get discounts. And what happens is that people who tend to have loyalty cards, tend to be heavy buyers or tend to be people who are going to be coming to you anyway.
“You’re giving discounts to people who are going to buy from you anyway. So your bottom-line is going to be affected by that.
“People are clever; consumers know what they’re doing,” Krog cautions.
“Tough times have real implications,” Krog says.
To win means more customers, slightly more often. “If there are less customers buying more often, that becomes even more difficult to do.”
She warns against market segmentation.
“You have to be incredibly careful not to segment your market. Taking very small group within your potential market and directing all your communications on them, means missing out on a whole lot of other people who are out there.
“It is very dangerous. It’s like writing a suicide note,” according to Krog.
Don’t focus on the “heavy buyers”, but less occasional buyers.
“If you focus on less heavy buyers, heavy buyers take care of themselves. They’re in the market anyway. Consistency moves the dial,” Krog says.
Penetration is the route to sustainable growth, research shows.
This means “building mental availability or power of the mind”. It means “being thought of when there’s a buyer in the market” and getting your brand into people’s minds.
Building physical availability doesn’t just imply bricks and mortar, but also pricing, she says.
“If you out price yourself, you’re going to lose a big segment of the market. Also you don’t want to price yourself too low so that you can’t sustain your business.”
A retailers brand is its best asset and one that it needs to “stick to as gold”.
Eighty percent of consumers use retailers’ inserts in newspapers to see what’s on offer, Krog says.
“If you’re not on the shelf, you’re not part of the planning. Over many years, people have developed the habit of knowing that this information is available to them in papers. When they make the decision to buy, they know that they can go there to find the place and price of where to buy.”
According to Krog, an effective media choice drives brand growth. “Papers tick all the right boxes,” she says.
The measure, which aims to add some US$1.5 billion to government coffers in just two years, is the latest to target additional cash from offshore oil and comes as the government pursues a record US$34 billion 2020 budget.
On Monday, Nigeria's president Muhammadu Buhari said on Twitter: “This afternoon I assented to the bill amending the Deep Offshore (and Inland Basin Production Sharing Contract) Act.”
"Nigeria will now receive its fair, rightful and equitable share of income from our own natural resources for the first time since 2003," he added.
It is not clear whether the measure will take immediate effect or lead to discussions with oil companies to review their agreements, and Buhari's office has estimated the change will bring in at least US$1.5 billion in added revenue annually by 2021.
As oil prices have slid this year, meaning a drop in revenue to the government, Africa's largest oil producer has been steadily increasing pressure on the some of the world's biggest energy companies - Shell, Exxon Mobil, Chevron Eni, Total and CNOOC - who extract most of the crude oil in Nigeria.
Oil company representatives fought aggressively to soften the changes; but after an hours-long closed door meeting with Nigerian lawmakers, they added an extra royalty, an industry source told Reuters, making it even more damaging for companies.
The measure passed through the legislature in a matter of weeks, an unusually quick pace for a country that has had a petroleum industry bill pending for more than a decade.
Majors are already fighting a surprise US$62 billion bill for offshore oil projects that the government delivered early this year.
Industry group Oil Producers Trade Section (OPTS), which represents oil companies that produce 90% of Nigeria's oil and gas, said this proposed law change, and the regulatory uncertainty it will create, could significantly undermine profitability for the projects, including behemoth fields such as Shell-operated Bonga and Total's Egina.
It expects the changes to the law to slash future offshore production by 27% to 2023, cut US$55.5 billion from investment over the lifetime of deepwater projects and remove some US$10.4 billion in potential government revenue by 2030.
"This is not in line with FGN's objective to grow the economy," OPTS said in a detailed analysis of the measure sent to Nigerian lawmakers.
It added that the changes would be "almost equivalent to no new [deepwater] projects being viable."
Offshore oil projects are among the most expensive, difficult and time-consuming for companies to develop. They have also added significant amounts of much-needed oil output in Nigeria in recent years - with Egina alone adding 200 000 barrels per day (bpd).
Nigeria's deepwater output has grown from nothing at the beginning of the century to 780 000 bpd in 2019, a significant chunk of Nigeria's roughly 2 million bpd of total production.
The law will change the 1993 Deep Offshore and Inland Basin Production Sharing Contract to add two new revenue streams. One is a flat 10% royalty on for all projects over 200 meters deep, and a 7.5% royalty on frontier and inland basins.
The second is a price-based royalty that would kick in when oil prices went above US$35 per barrel and increase as prices rose.
The law will also require the underlying law to be reviewed every five years. Offshore projects typically require a minimum of 20-year life span in order for the investment to make sense for companies.
OPTS said potential changes to terms in the middle of contracts makes it incredibly difficult, if not impossible, to assess profitability and make investment decisions, advocating for stable terms for the life of each project.
"The proposed unilateral change to current terms would damage investor confidence and make Nigeria's Deepwater and Inland Basin PSC significantly less attractive in the wake of stiffening global competition for investable funds," the OPTS analysis said.
Tax now, or ‘grow the pie’?
It encouraged the government to address all fiscal terms in the long-awaited petroleum industry bill, and to increase revenue by efforts to "grow the pie", rather than heavily tax existing production.
Buhari, in a speech outlining a record budget last month, pressed lawmakers to move quickly to pass a bill to change this law so the contracts would "reflect the current realities and for more revenue to accrue to the government."
Still, oil sources and industry watchers said the short-term rush for cash could ultimately sabotage long-term oil development and revenue.
Shell has already said it will not make a final investment decision in its offshore Bonga SW project until the tax bill dispute was settled.
"Once the real-world impact of this legislation become clear, the government may need to repeal or soft-pedal it or else new offshore projects may evaporate," said Matthew Page, an associate fellow with the Africa Programme at Britain's Chatham House. - Nampa/Reuters/AFP
Rivele has borrowed around R80 000 since losing her job as a security guard due to injury in 2016. Now she owes around R3 500 in monthly instalments, more than her monthly income.
"I can't afford to pay because I'm a single parent, I'm the one who is providing food on the table," the 44-year-old said in a shopping centre on the outskirts of her home township of Alexandra in Johannesburg.
"I can't sleep."
The situation of people like Rivele shows both the potential benefits – and unintended consequences - of a new law signed by president Cyril Ramaphosa in August, aimed at protecting vulnerable borrowers.
The National Credit Amendment (NCA) comes as some lenders make healthy profits on loans while many of the country's poorest people spend huge chunks of their income on repayments. It could see some South Africans have their debts suspended or wiped entirely, and force more responsible lending.
Less loans from banks
This could be good news for many who, like Rivele, are stuck in debt traps. However, a number of big banks told Reuters that the new rules, and the potential risks entailed for lenders, meant they had or would cut back on lending to those low-income customers who might qualify for relief in future.
"You are asking yourself, do you want to play in that particular market, or do you move away?" said Gerrie Fourie, CEO of Capitec, South Africa's fifth-largest bank.
This could cause serious difficulties for some families in a country where the unemployment rate is almost 30% amid sluggish economic growth, living costs are rising, and millions of people cannot make ends meet.
Around a third of the population rely on loans for necessities like food, according to financial inclusion organisation FinMark Trust.
African Bank, a smaller lender that targets low-income consumers, said it already had and would further reduce its lending to qualifying borrowers in response to the NCA.
Arrie Rautenbach, the retail bank CEO of Absa, told Reuters it would cut back on new lending to the riskiest borrowers among those who qualify for NCA relief, while Jacques Celliers, his counterpart at another of South Africa's big four lenders FirstRand, said it had already gradually trimmed new lending to the group in anticipation of the law.
Capitec said in August it had, over the past two years, reduced the proportion of borrowers who would qualify for NCA relief in its lending book to less than 5%.
Fourie told Reuters the figure has previously stood at 12-15%, with the reduction mostly driven by a deteriorating economy, but with the upcoming credit law also a factor.
The other two members of South Africa's big four – Standard Bank and Nedbank - said they were watching how the situation developed.
Short-term credit, the type of credit most commonly held by the poorest borrowers, has been squeezed since lawmakers began looking at debt forgiveness in 2016.
It dropped from R3.64 billion in the final quarter of 2015 to R2.27 billion in the second quarter of this year, data from South Africa's National Credit Regulator (NCR) shows.
Cas Coovadia, who heads the Banking Association of South Africa, said the law would either raise the cost of credit for some of the most vulnerable borrowers or stop banks lending to them.
This risks some being pushed back into the informal sector, dominated by a large network of illegal loan sharks known as mashonisas, Coovadia, bank executives and some debt counsellors say.
"You don't want people to end up in the informal sector, that is never good," said Absa's Rautenbach. "It's a very bad unintended outcome."
This was echoed by Brett van Aswegen, South Africa CEO of payday lender Wonga. He said his company's research showed mashonisas were already widely used, adding it would be "naive" to think consumers in need of cash would not go there.
Mashonisas like 31-year-old Dani, who operates in and around Northam, a mining town in the northern province of Limpopo, commonly charge interest rates as high as 50%, and sometimes use violence to get their money back, according to debt campaigners.
Dani, who declined to give her surname as she is breaking the law, takes identity documents and bank cards as security, and if clients don't pay on time, hikes the interest to 100%.
It boosts her business when people can't go to the bank for loans, she told Reuters.
"If the economy is bad, it is good for me, like if there is a strike at the bank, [customers] have to come to me," she said.
The NCR, and Clark Gardner, CEO of consumer advice firm Summit Financial Partners, disputed that borrowers would be pushed into the hands of loan sharks and said it would not be a bad thing if they had less access to credit.
Lesiba Mashapa, NCR company secretary, said big lenders granted loan sizes he viewed as excessive.
Gardner provided Reuters with loan agreements from two big banks in 2016 and 2017 respectively, with repayment periods of three and four years, where the cost of credit - interest rate plus charges - was 60% and almost 100%.
Differential Capital, an asset manager, agreed in a report published in August that irresponsible unsecured lending was far from the preserve of mashonisas, with formal providers "preying on financial illiteracy".
The NCR moved to protect borrowers in the wake of a leap of almost 290% in unsecured lending between 2007 and 2012 following measures to tackle racial discrimination in the credit market.
Differential Capital's report said two-thirds of the 7.8 million, usually low income, consumers with unsecured loans spent more than a quarter of their net income on servicing their debt, while around half are in default.
‘Qualifying for forgiveness’
The new law will see the credit regulator take over debt counselling for indebted consumers earning less than R7 500 per month - who are largely unable to afford private fees – and with unsecured loans of less than R50 000.
It will allow all or part of their debt to be suspended for up to 24 months and wiped entirely in some circumstances, for instance if they lose their job.
Estimates vary, but the National Treasury projected in October 2017 that up to R20 billion of consumer debt could qualify for forgiveness. That's small in an overall consumer debt stock of R1.9 trillion.
Brendan Pearce, chief executive of FinMark Trust, said measures to open up the credit market in South Africa had worked "almost too well".
He said that while the NCA credit amnesty could provide some short-term relief, it was not a long-term solution because so many people depended on debt to put food on the table.
"I can't sit here and say we shouldn't be allowing more credit to consumers who otherwise wouldn't be able to survive."
More was needed to tackle the problem, Pearce added, including working to address its roots: the state of South Africa's economy. – Nampa/Reuters
Ivory Coast and Ghana, which together account for more than 60% of global cocoa production, initiated deals with chocolate makers in July, adding a "living income differential" (LID) to prices.
Barry Callebaut and Nestle, two world leaders in cocoa products, confirmed that they would pay a supplement of US$400 per tonne above the market price to help farmers, in the wake of announcements during an October meeting of the World Cocoa Foundation in Berlin.
The neighbouring West African countries in June said they would set the minimum price per tonne at US$2 600 for the 2020/21 season.
Nestle, Barry Callebaut
Nestle "have already started buying 2020/21 cocoa with the living income differential", declared the world's largest food and beverage company in a statement.
"The LID will help improve farmers' living income and complement all our efforts to improving the lives of farmers," it said.
Barry Callebaut, another firm with headquarters in Switzerland, declared that it agrees with the principle enabling the Ivorian and Ghanaian governments to back a minimum cocoa price to cocoa farmers.
The firm stressed that the LID should be "executed in a way which contributes to sustainability and structurally improves farmer livelihoods, without inducing further expansion of cocoa production into forests."
"This is historic! The two countries together have managed to convince private buyers to raise the purchase price so that producers can earn more," Michel Arrion, executive director of the International Cocoa Organisation (ICO), told AFP.
Below poverty line
Ivory Coast, with 40% of world production, and Ghana, with 20%, pressed hard for a deal that would benefit cocoa planters, who receive only 6% of a global market for cocoa and chocolate valued at US$100 billion per year.
The purchase price of cocoa to Ivorian farmers was set at 825 CFA francs (1.25 euro) per kilogramme at October's opening of the new cocoa year, a raise of 10%, according to the Coffee Cocoa Council (CCC).
Experts in Ivory Coast say that cocoa prices are still too low, even with the LID, since more than half of the million people working in the sector live below the poverty line, earning less than US$1.20 per day according to the World Bank.
"This is a plus for the producers, but even if they were to get the whole of the price increase, it wouldn't lift them out of poverty," said one expert who asked not to be named.
The LID should provide for payments of 1 000 CFA francs (1.52 euro /US$1.70) per kilo to Ivorian planters, an improvement on 825 CFA francs (1.25 euro), said Romeo Dou, an agricultural engineer.
His company Microfertile helps cocoa-growing cooperatives to improve cultivation and to process raw cocoa into semi-finished products such as cocoa butter and powder to benefit from the added value.
By way of taxes and intermediaries on the ground, from tax collectors to cooperatives and exporters, the Ivorian state intends to profit from the LID, Dou said.
He believes cocoa planters will end up receiving 60% of the LID and the remaining 40% would wind up in other hands.
"Even 1 000 CFA francs won't change a thing in the lives of the planters," Dou said.
"The LID business worries us ... Which mechanism of the Ivorian state is going to make sure that cocoa planters receive the money they are owed?" asked Moussa Kone, president of a farmers' union.
Kone said that bonuses due to farmers in the name of international fair trade schemes were going unpaid. "For planters to get out of a rut, we need a price of 3 000 CFA francs per kilo," he estimated.
Dou and the anonymous expert both estimated that the sector could only really support one in five of the current planters, or even just one in ten, if they aren't to live in poverty.
"We have to produce better, in an intensive way, on smaller land areas, with well-trained planters. It will take political courage to reform the sector," Dou said. – Nampa/AFP
The World Boxing Organisation (WBO) global international lightweight champion has put his title on the line and risks slipping down the rankings against a boxer who has already beaten three Namibians in his career.
Pambeni has a perfect record on Namibian soil, having beaten Junius Amunyela, Nakathila's trainer Siegfried 'SBK' Kaperu and Albinius 'Danny Boy' Felesianu over the years. Nakathila said yesterday he is not frightened of Pambeni and has a plan for him.
“I am ready to punish Pambeni and avenge what he has done to my fellow countrymen.
“I have been training very hard even, before this fight was announced, and that is why I am confident in what I can do on the day.
“The fans must just come in their numbers to watch me end my year in style,” Nakathila said.
The boxer's last fight was in April, when he outclassed Zoltan Kovacs of Hungary at the Windhoek Country Club Resort, winning via a technical knockout.
Nakathila boasts a record of 19 fights, with 18 wins and one defeat in his professional career.
Rated number three in the WBO junior lightweight division, Nakathila is facing a heavy test as he comes up against a boxer who has hordes of experience. The Namibian has a chance to move up the rankings if he emerges victorious on the night.
A win for Nakathila can also make him a mandatory challenger for the world title.
However, he could lose it all if he gets beaten by the WBO Africa lightweight champion, Pambeni.
Nakathila's promoter Nestor 'Sunshine' Tobias is, however, confident.
“Yes, we know very well that this is not going to be an easy fight for Nakathila, because he is coming up against a boxer who has already beaten three Namibians.
“The risk is there, but we do have to take risks if you want to become a world champion.
“Nakathila is in a class of his own and that is why I am confident that he will deliver positive results on the day,” Tobias said.
The Zimbabwean, who has already fought 23 times in his professional career, has a record of 17 wins, three loses and three draws.
MTC corporate communications manager, John Ekongo, is pleased by the fact that the company has been able to support boxing over the years. Ekongo is adamant that MTC's involvement in boxing has helped elevate many lives.
“We have become slaves of success, because of what we have been doing to the lives of many of these boxers.
“As a sponsor, we are not always happy when we do not have a world champion.
“We will, however, continue to create a platform for young men and women.
“Corporate Namibia must join us and support the dreams of many of these young boxers,” Ekongo said.
There will be nine undercard fights on the night.
One of the interesting match-ups will be Harry Simon Jnr against Malawi's Limbani Chikapa in an eight-round junior welterweight fight.
General tickets are available at Computicket and the Nestor 'Sunshine' Tobias Boxing and Fitness Academy head office and are selling for N$200, while VIP tables for 10 are going for N$10 000 each.
The other fights are as follows:
Charles Shinima vs Thembani Mhlanga (Zimbabwe).
Paulinus 'John John' Paulus vs Enok Musambudzi (Zimbabwe).
Philipus Ngitumbwa vs Wiseman Tshuma (Zimbabwe).
Paulus Amavila vs Michael Kambunga.
Abed Shikongo vs David Haufiku.
Philipus Shaanika vs Nashilongo Theofelus.
Paulus Aileka vs Wanangula Wilhem.
Joseph Abel vs Salatiel Moses.
Jesse Jackson Kauraisa
Interim coach Bobby Samaria has announced a training squad of 24 players, who started training on Monday morning at the match venue.
All the players called up, with the exception of Hendrik Somaeb, were present at the two training sessions.
Speaking to Nampa at the training session, Samaria said he has opted to use locally-based players for the match against Zambia, before blending in foreign stars for the Africa Cup of Nations (Afcon) qualifier matches scheduled for later this month.
Benson Shilongo, who plays for Egyptian team Ismaily, has also joined the squad.
“Zambia will also bring their African Nations Championship (Chan) team, as they have qualified for Cameroon 2020. It is important that we keep the team together, as it gives us an opportunity to see if we have the right quality for the tournament,” he said. He said the match against Zambia will also help improve the match fitness of locally-based players, who are currently inactive.
Samaria said he added two new technical team members in goalkeeper coach Sparks Gotlieb and Donatha Ngunovandu.
“We are playing the president's cup and his motto has always been about inclusivity. This is our way to emulate his noble call, hence the presence of Donatha and Sparks. In addition, they are capable Namibians, who I believe can add value to our cause,” he said.
Samaria added that the technical team is only in place for the Dr Hage Geingob Cup.
The players training for the Hage Geingob Cup match are as follows:
Goalkeepers - Edward Maova, Ratanda Mbazuvara, Calvin Spiegel and Charles Uirab.
Defenders - Vitapi Ngaruka, Emilio Martin, Ivan Kamberipa, Pat-Nevin Uanivi, Aprocius Petrus, Gregory Auchumeb, Larry Horaeb and Tjiuna Tja Tjatindi.
Midfielders - Dynamo Fredericks, Immanuel Heita, Wendell Rudath, Obrey Amseb, Gustav lsaack, Llewelyn Stanley, Marcel Papama and Absalom Iimbondi.
Strikers - Benson Shilongo, Elmo Kambindu, Panduleni Nekundi, Isaskar Gurirab and Mapenzi Muwanei.
Dortmund looked out of it at 0-2 down at halftime, as Lautaro Martinez put Inter ahead after just five minutes, before Matias Vecino added a second just before the break at Signal Iduna Park.
However right-back Hakimi orchestrated a remarkable recovery by finishing a move he started five minutes into the second half before Julian Brandt equalised.
Morocco international Hakimi, who turned 21 on Monday, hit the winner for Dortmund with 13 minutes to go.
“It feels really good,” Brandt told broadcaster DAZN.
“We all knew how important the game was for us to win, but the (second-half) reaction was absolutely crazy.
“I think that we are in the development phase and that not everything quite fits yet.
“If everything was perfect, it would also be a bit boring,” he added with a grin.
The result leaves Dortmund second in Group F, a point behind leaders Barcelona, who they face at the Camp Nou in three weeks.
Inter are now third in the group, three points behind Dortmund, before their next game at Slavia Prague.
After a 2-0 loss in Milan a fortnight ago, Dortmund had rebuilt confidence with back-to-back wins over Moenchengladbach and Wolfsburg but were dominated in the first half here.
Martinez struck early on with a superb solo effort after mistakes by both Dortmund centre-backs.
A long ball through the middle evaded Manuel Akanji with its bounce, leaving Mats Hummels isolated on the edge of the penalty area.
Hummels lost the one-on-one and could only watch as Martinez drilled his shot past Dortmund goalkeeper Roman Burki.
Martinez, who also scored against Dortmund in the reverse fixture, became the first Inter player to score in three consecutive Champions League appearances since Samuel Eto'o scored in four in a row in 2010.
Dortmund captain Marco Reus failed a fitness test on a foot injury before kick-off and the Germany forward was missed as Mario Goetze missed two clear chances at the other end.
Inter's second goal was a cracker as midfielder Vecino finished a brilliant team move.
Marcelo Brozovic won the ball from Brandt and his pass found Martinez whose raking cross-field pass landed at the feet of Vecino, who beat the defence to double Inter's lead on 40 minutes.
Dortmund came out firing for the second half and pulled a goal back when Hakimi managed to connect with Goetze's cross as the hosts attacked with regularity.
Goetze then made way for Paco Alcacer, whose first touch of the ball was to flick it to Brandt from an Inter throw, the Germany winger sweeping home the equaliser on 64 minutes.
Axel Witsel headed wide as Dortmund hunted the crucial third goal.
It soon arrived as Hakimi completed the fightback on 77 minutes when he again used his pace to tuck home Jadon Sancho's pass and put Dortmund back on course for the knockout stages.
Omulumentu gwoomvula 26 okwa dhipaga yina, Vilgenia Teofelus, omumwayinamati gwoomvula 30, Simon Petrus ngoka a li ta kambadhala okugamena yina oshowo okatekulugona komvula yimwe, Ndapandula Ndahalaovanhu Hafeni, na okwe ehameke noonkondo okatekulugona koomvula mbali, Gift Rejoice Petrus nokudhipaga ombwa oshowo iikombo ihetatu omanga ina landulila aanona mboka yaali ya yi ontuku kaandja mushiinda.
Omulumentu ngoka okwa tulilwa mo iipotha yedhipago oshowo onkambadhala yedhipago, oshowo elongelo lyiinamwenyo uuhwapindi.
Olopota yopolisi oya holola kutya omulumentu ngoka okwa tete yina oshowo mumwayinamati nokatekulugona nekata momutse, ayehe oya sile pehala lyoshiningwwanima. Omufekelwa okwa ehameke noonkondo Petrus sho a teteko okugulu kwe kokolumoho showo oonyala mbali konyala yokolumoho. Okwa yi koshigunda shiikondo nokuteta iikombo iheyali omitse oshowo ombwa.
Olutu lwayina oshowo mumwayimati oga adhika popepi negumbo omanga guunona mboka uwali ga adhika mondunda.
“Shoka sha etitha edhipago ndyoka kashi shiwike ihe pahapu dhomumwayinakadhona, Olivia Petrus, omufekelwa okwe ya lombwele okuza mOsoondaha kutya oha mono aantu oyendji pegumbo lyawo na okwa kala nekataa aluhe aniwa lyokukondjitha aantu mboka kaayewetike. Ekatana ndyoka olya dhika lya holekwa momukunda Okelemba,” olopota yopolisi ya holola. Olopota yopolisi oya tsikile kutya Petrus okwa falwa koshipangelo kEngela ihe okwa tumimwa moshipangelo shaShakati meendelelo omanga uunona uuwali mboka wa hupu wa tulwa mesiloshisho lyomuhungimwenyo. Pahapu dhamushiinda, Losalia Ndakalako, okwa penduka ongula lwopotundi onti 05h00 omolwa aanona yaali mboka ye ya megumbo lye taya kugu taya kongo ekwatho. “Sho nde ya pula oya hokolola kutya hekulu okwa ponokela aantu nekatana maandjawo. Oya popi kutya okwa Ii mondunda moka mwali mwa lala yinakulu na okwa kutha ekatana kohi yombete ya yinakulu na okwa pula opo ya ze mo megumbo. Omanga inaya za mo yinakulu okwa li ta kambadhala okukutha ko ekatana komufekelwa,” Ndakalako a popi.
“Sho ya yi pondje yegumbo oya adhiaka ontu ya mangwa na oya londo egumbo opo ya vule okufadhukapo. Otwe ya tula mondunda na oyali ya tila okukala mo oyo ayehe. Onda dhengele ongodhi yina yaanona mboka e li kOvenduka opo a dhengele opolisi ihe konima yethimbo omufekelwa okwe ya megumbo lyetu ta kongo aanona mboka ihe otwiipatele mondunda na okwa shuna.”
Ndakalako okwa popi kutya oya li ya tila na inaya za mo mondunda, osha kutha opolisi uule wowili yimwe opo yi thike.
Pahapu dhakomanda gwopolisi yaHangwena, Simeon Shindinge okwa popi kutya omanga opolisi yali tayi yi kehala ndyoka olya tsakanene nomufekelwa na oye mu tula miipandeko na oya yi na ye kehala lyoshiningwanima.
Shindinge okwa popi kutya omufekelwa aniwa okwa li a ningi omasiku a za po pegumbo na opo owala a galuka na otaya fekele kutya oha longitha iingangamithi nomalovu.
Omupeha presidende gwoNational Students Association (NASA), Paulus Vihemba okwa popi kutya omolwa ekateko ndyoka aailongi otaya mono iihuna unene mboka aakwanaluhepo taya thiminikwa konkalo opo ya thigepo omailongo gawo.
Vihemba okwa popi kutya ekateko ndyoka otali tula muupyakadhi aailongi shoNamibia Students Financial Assistance Fund (NSFAF) ha gandja owala kaailongi mboka oshimaliwa pehuilo lyomvula.
Vihemba okwa popi ngaka pethimbo lyomutumba gwiikundaneki ngoka a ningi moRundu.
Okwa popi kutya aailongi yamwe otaya ende iinano iile okuya kooskola molwaashoka kaye na iifuta yootaxi omanga yamwe taya hiila momahala gaahena uundjolowele na kage li pankalo ombwaanawa opo ya vule okukala popepi nooskola.
“Ngashiingeyi lombwelandje kutya omwiilongi otaka ninga shike noshimaliwa shooN$15 000 shoka ta pewa kehulilo lyomvula ngele kwa ndopa oshilongwa shimwe molwaashoka ina vula okuya koskola mokati komvula omolwa ompumbwe yiimaliwa yotaxi nenge ke na iikulya opo a vule okwiilonga.”
Okwa popi kutya aailongi oya pumbwa okwiilongekidhila nawa omakonaakono gawo ihe shoka otashi kala oshidhigu molwaashoka oya taalela omapuyakadhi ogendji ngaashi ondjala na ohaya zi pomahala pwaaheli nawa.
Statistics provided by the Intelligence and Investigation Unit in the environment ministry and the Protected Resources Unit in the safety and security ministry indicate that four wildlife products were seized.
These included two elephant tusks, a giraffe skin and a pangolin skin. Police also seized one firearm and a vehicle.
Johannes Petrus, Ngavepue Tijuana and Kavenamuruke Tjihange were arrested on 27 October at Werda for conspiring to hunt a rhino. They were charged with contravening the Nature Conservation Ordinance and with contravening the Arms and Ammunitions Act. One hunting rifle was confiscated.
The following day another suspect, Tjizo Tjiposa, was arrested for the same crime at Werda. They are all Namibians.
In another incident at Wanaheda, Immanuel David Angula was arrested on Monday last week for being in possession of a giraffe skin. He was charged with contravening the Controlled Wildlife Products and Trade Act. An Angolan national, Muhenhe Tchimbanda, was arrested on Thursday last week at Outapi for being in possession of a pangolin skin. He was charged with contravening the Controlled Wildlife Products and Trade Act.
Four suspects were arrested last Sunday at Rundu for being in possession of two elephant tusks and they were charged with contravening the Controlled Wildlife Products and Trade Act. A vehicle was confiscated by the Blue Rhino Task Team and the Protected Resources Unit.
Mukoya Katombera was found guilty by the Rundu Magistrate's Court for possession of a live pangolin and was sentenced to a fine of N$40 000 or three years in prison.
Katombera was arrested on 9 September and charged with contravening the Controlled Wildlife Products and Trade Act. He was found guilty on 24 October.
Crime investigations coordinator for the region, Deputy Commissioner Bonifasius Kanyetu, said on Monday sexual offences are on the rise, with seven rape cases registered with the police in the region during October.
“It is high time that people avoid moving around at night, because there are unfortunate ones who fall victim to criminals,” he advised.
Kanyetu urged women and girls to always be in the company of other people they know, when walking at night. He said every weekend there is a rape case reported, with most cases emanating from drinking holes. In its weekend crime report on Monday, the police said a 28-year-old woman was raped near a nightclub at around 04:00 on Saturday, after a suspect snatched her phone and ran away.
“She followed him to get her phone back, he grabbed her and forcefully undressed her, then had sexual intercourse with her without her consent,” the report said.
No arrests were made and police investigations continue.
In another incident, a 20-year-old woman was grabbed by two male suspects, who pulled her in the nearby bushes and raped her.
The suspects are allegedly known to the victim, but no arrests have been made.
Police investigations continue.
This is the conclusion reached by researchers Dietrich Remmert and Rakkel Andreas of the Institute for Public Policy Research (IPPR) in their briefing paper 'Risks and Rewards: Making Sense of Namibia-China Relations', which was launched last week.
The researchers say while the Namibian government's engagement with China is “extensive, overtly friendly”, it can also be argued that it is “lacking in caution” and “critical reflection or strategy”.
The researchers say what is woefully missing from this picture is clear and unambiguous data, and how this is related to the Namibian public.
Investments in Africa, Namibia
Concerns are growing over the debt status of developing nations and China's role.
It is estimated that China currently holds debt from developing and emerging markets amounting to US$360 billion, compared to the US$246 billion held by the Paris Club, which are the 22 major international lenders, including the USA, Germany, and Japan.
Yet, Africa's external debt is not held by China; 35% of the continent's public debt is owed to international institutions like the International Monetary Fund (IMF) and the World Bank.
Past annual trade statistics published by the Namibia Statistics Agency (NSA) showed that Namibia imported more from China than what it exported. This changed in 2018, when Namibia recorded a trade surplus of just over N$10 billion with China.
In 2018 China became the top export destination for Namibia, amounting to 18% of all its exports, outpacing Botswana and South Africa.
The bulk of these exports consisted of copper that had been imported from Zambia, which means that much of the economic value, like mining jobs and tax revenue from mining activities, is located outside Namibia, the researchers state.
Namibia exports mainly uranium oxide to China, and imports primarily manufactured goods like industrial and electrical machinery, iron or steel articles, motor vehicles and aircraft.
Investment from China has mostly been in the extractive and construction sectors.
Namibia-China debt issues
The Namibian government has denied that it has borrowed unsustainably from China. In September 2018 finance minister Calle Schlettwein said Namibia's debt to China was about N$2 billion, or 2.6% of the total national debt.
Inexplicably, however, Schlettwein in May 2019 said bilateral loans from China and Namibia amounted to N$1.19 billion, or around 1% of Namibia's total debt - a significant drop in less than a year.
Furthermore, in March this year, the ministry said Namibia owed just over N$2 billion in Yuan, China's currency.
Chinese SMEs in Namibia
A visible growing trend is the increase of Chinese small and medium enterprises (SMEs) in Namibia, but the IPPR researchers say very little official data is available on these.
The Business and Intellectual Property Authority (BIPA) said in August that about 1 176 businesses here were either owned by Chinese nationals or had Chinese shareholding. However, it is not clear what activities half of these – or 606 – are engaged in.
The rest are said to be engaged in services, property and real estate, wholesale and retail, the latter including catering and accommodation services. Only a few are said to be in manufacturing, commerce and the construction industry.
The IPPR researchers say it remains difficult to establish the economic and social impact of these Chinese shops, although earlier labour researchers concluded that the small shops had little benefit for Namibia's overall development.
The Polytechnic of Namibia researchers in 2009 said Chinese investment did not necessarily result in negative consequences for local citizens or businesses, maintaining that stiff competition would force local companies to become more effective and productive.
The Namibian government's position on this is clear: while local companies in the retail and construction sectors expect support and industry protection, government argues that it needs to attract foreign investment to grow the economy.
A competitive analysis of the meat industry in Namibia was done by the Meat Board of Namibia, specifically focusing on the meat export value chains versus the livestock export value chains.
The study also compared Namibia with other major meat exporters such as Uruguay, Australia, New Zealand and South Africa.
The study was conducted by Optimal Agricultural Business Systems, a group of reputable independent agricultural economists.
“Investigating the growth in the contribution of the agriculture and forestry and livestock farming sectors to the Gross Domestic Product (GDP) from 1981 to 2018, the agriculture and forestry sector grew by 2%, while the livestock sub-sector grew by 0.7%,” said the Meat Board.
According to the Meat Board, year-on-year fluctuations in their contribution to the GDP since 1991 also became evident.
“Various factors could be attributed to the fluctuations, such as periodic droughts, abattoir inefficiencies and export interventions.”
The study modelled the financial benefits to be accrued to the agricultural GDP if local slaughter and finishing of livestock could be achieved, which indicated an increase of 100 000 marketable animals in the Northern Communal Areas (NCAs) and a 10% carcass price increase.
Furthermore, it indicated improved carrying capacity (10% increase in production) for NCAs and areas south of the Veterinary Cordon Fence.
A shift from weaner production towards ox production could increase the livestock sector's contribution to GDP by N$914 million, resulting in an increase of 23%.
“It is thus of crucial importance that beef produced in the NCAs could be exported to financially viable markets and that the green scheme projects of AgricBusDev produce fodder for feedlot weaners in Namibia.”
The Meat Board said it is therefore important that all stakeholders in the Namibian meat industry under the auspices of the agriculture ministry meet to address the shortcomings in the industry and formulate new strategies to position the meat industry five years ahead.
“Such an exercise to restore fundamentals in economic growth (GDP) is not new and occurs on a regular basis in most meat -exporting nations.”
Areas to focus on should be the export of beef from north of the Veterinary Cordon Fence, developing the correct policy mix to enhance local value addition without eroding the primary sector, and implementing a post-drought recovery strategy by not interfering with the market channel.