Namibia’s mining policies perceived as second best in Africa

Namibia’s mining policies perceived as second best in Africa       

Namibia ranked as the second most favourable mining jurisdiction in Africa on the Fraser Institute Survey of Mining Companies Report, a significant improvement from its ranking of fifth position in 2020.

Morocco had the highest Policy Perception Index (PPI score) and ranked first in Africa. The absolute improvement of Namibia’s score from 74,30 points in 2020 to 75,20 in 2021 is marginal and still much lower as compared to the country’s outstanding scores achieved in 2018 and 2019 (80.7 points and 87.22 points respectively).

Namibia is one of only three African jurisdictions to improve on this score.

Globally, Namibia gained 18 places on the PPI score from 47th position in 2020 to 29th position in 2021.

According to a statement by the Chamber of Mines of Namibia there is still much to be done to improve Namibia’s policy landscape.

The survey solicited more than 9 responses in the 2021 survey, a positive outcome which enhances the overall validity of Namibia’s findings. Namibia’s lower PPI score in 2021 with more respondents thus corroborates with the less favourable policy environment in 2020 as was evidenced by a similarly low PPI score received by fewer respondents (less than 9).

Concerns raised despite improvement

Despite the overall good performance, there were a few negative concerns raised in the report about Namibia’s policy environment.

These include a lengthy permitting process that hinders project development, and concerns about the non-deductibility of royalties.

According to the Chamber of Mines of Namibia the latter response is not valid as this matter was successfully resolved in 2020.

“The quoted concern is that non-deductibility of royalty payments prevents the sector from minimising costs and hurts the industry’s competitiveness. The Chamber is of the view that this statement negatively affected Namibia’s performance. Namibia’s PPI score, and it’s ranking globally and on the African continent, would have been much better without this erroneous and baseless concern as this risk is no longer applicable, and has not been in the last two years,” the Chamber states.

Despite the above concerns the Chamber states that the report accurately reflects the overall status quo of the current investment landscape, one which appears to be in limbo rather than improving dramatically.

“It remains increasingly worrisome that while pronouncements by the government favour a conducive investment environment, there is no visible corresponding actions to demonstrate the finalisation of outstanding policy matters that continue to perpetuate investor uncertainty. The Chamber remains committed to working with the government to overcome these hurdles, and to ensure the most favourable policy outcomes are reached to benefit mining and Namibia, and to once again make Namibia the most attractive jurisdiction for investment into exploration and mining on the African continent.”

WhyAfrica will travel through Namibia in June and July 2022 as part of its Southern African Road Trip and will visit several mining, energy, agriculture, tourism, conservation, and infrastructure projects in the country. During the same trip, we will also visit the Northern Cape province of South Africa, Zambia, Zimbabwe, and Botswana. If you are interested in being interviewed or if you want to be one of the main sponsors, please contact us at leon@whyafrica.co.za

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