What makes ‘Invest in Namibia 2016’ so special?
Gabriel Sinimbo the permanent secretary in the Ministry of Industrialisation, Trade and SME Development spoke to New Era’s senior business and economics journalist, Edgar Brandt, about the upcoming international investors conference.
The Invest in Namibia Conference, scheduled for November 8 and 9, has of late been aggressively promoted. The conference was launched and marketed by President Hage Geingob in New York on September 22 and again in Johannesburg on October 6, is already attracting so much attention that organisers are considering doubling the size of the venue.
The conference, which is being organised by the Ministry of Industrialisation, Trade and SME Development, initially planned to cater for 500 participants, but permanent secretary in the ministry Gabriel Sinimbo, yesterday told New Era that significant interest from international investors means they are considering doubling the size of the venue.
New Era: Who initiated the Invest Namibia 2016 Conference and why?
Sinimbo: The Invest in Namibia 2016 Conference is an initiative of His Excellency the President to improve foreign direct investment into Namibia. It is a targeted investment conference in the sense that it is a platform where Namibia has scoped some projects and we have already identified sectors that are of utmost importance where we need to focus on in order for us to grow our economy in our efforts to industrialise Namibia.
New Era: What differentiates this conference from other investment conferences we have seen in recent years?
Sinimbo: If you have attended other investment conferences, they will tell you to invest in Namibia and more specifically in agriculture or manufacturing and the likes. Then they will tell you that we have these good policies in terms of investment and so on. However, it is always a challenge when an investor wants to commence with the investment in a particular sector.
There are challenges in land issues and the facilitation process. This is why we have taken a different approach with this conference in saying that we should be ready as a country by identifying viable projects and by ironing out the bottlenecks that serve as impediments to investors. These developments enable us to tell investors that this is what we have on the menu and this is why we refer to this event as a ‘targeted investors conference’.
New Era: Why should international investors consider putting their money in Namibia?
Sinimbo: We are celebrating as a country the fact that Namibia is seen as a destination that is feasible and conducive as an investment environment. There are a number of things we can celebrate as a country. For example, Namibia is rated as number one in Africa in terms of press freedom. We have been doing well in terms of the country being rated as the second most favourable destination in Africa for mining and exploration.
An investor will be interested to know that it’s not just a country, but a country excelling in this particular aspect. Even our transport infrastructure is second best in Africa and this is a ranking from the World Economic Forum. We are the fourth best tourist destination in Africa and in terms of good governance we are ranked fifth. Finally, but not least, in terms of the financial sector our banking institutions have been ranked 22nd in the world. This is quite impressive and these are some the things we are sharing with our investors and most of them look at these rankings. This is what makes Namibia so attractive.
New Era: What are some other reasons for investors to consider Namibia?
Sinimbo: For the last years since Independence our economy has been very stable. In fact, over the last four years we have been clocking an average growth rate of 5.7 percent, which is quite impressive. The business environment is quite friendly and from Namibia it is relatively easy to access other markets, not only in SADC, but also the rest of Africa. Then the judiciary independence is an aspect of comfort for the investors, because if they have any legal issues they want to know that there is an independent entity that can protect their investments.
I must also indicate that we make it much easier as a ministry in terms off facilitating the processes for investors. Imagine going into a new country where you want to establish a new business. Normally there will be quite a number of institutions to deal with. You will not know where to start. That’s why we have the Namibia Investment Centre (NIC), which is a department housed within this ministry. They take care of the total facilitation of an investor, both before and after the investment. If you are interested to find out how our processes work, or what Namibia is all about in terms of investment, then the NIC is your one-stop shop to engage with. We facilitate entry, as well as work permits, visa facilitations, registration and even where there is a need for industrial land then it is the responsibility of the NIC to make it much easier for investment.
New Era: What are some of the incentives for investors to consider in Namibia?
Sinimbo: One aspect that investors also look at is the incentives to invest in a particular country. We have numerous incentives, particularly for manufacturers, meaning those that take our raw materials and add value to such. Incentives for manufacturers, for international and local investors, include:
1. A special allowance for factory buildings enables these buildings to be depreciated by 20 percent for the first year and then for the eight percent for 10 years. This is a huge financial benefit for investors;
2. A transport allowance deduction of 25 percent of total cost if goods are transported by road of rail in Namibia;
3. In terms of export promotion manufacturers benefit from an additional deduction of 25 percent from taxable income, which we allow;
4. An additional deduction of 25 percent to 75 percent as an incentive for training;
5. Up to 50 percent off any industrial studies conducted in respect to the business. There are times when businesses commission studies when they want to expand or when they want to venture into new areas;
6. As much as 50 percent off direct cost of approved export promotion activities.
New Era: What are the priority areas that have been identified for investment?
Sinimbo: The areas of priority to us are in manufacturing, servicing of land and the provision of affordable housing, tourism, transport and logistics, infrastructure development and the energy sector (in particular renewable energy). These are our priorities but it doesn’t mean that an investor who comes to Namibia and wants to enter a different sector is not welcome. They may because we are open to all areas [of investment].
New Era: What are some of the specific projects you have selected for investors to consider at the conference?
Sinimbo: We identified specific projects and appointed consultants to help us look at the feasibility of these projects and to prepare documents that investors can look at. There are quite a few projects, of which some of the major projects include the following:
In the energy sector we have an electricity generation biomass harvesting project. This project has a total investment cost of N$1.2 billion. Another project in the energy sector is solar project that comprises of a thermal storage component. This project has an estimated investment cost of N$13 billion.
The upstream and downstream aspects of the Kudu Gas project are also being marketed. This includes the gas field (upstream) and the power station and transmission aspect. The cost of this project has not yet been finalised.
In terms of affordable housing there is Ongos Monte Christo City, which will be on a large piece of land almost the size of Windhoek. This project is estimated at N$13.5 billion.
Also, in infrastructure we have realised as a country that we need to improve our transport system, particularly in Windhoek, where it is becoming increasingly congested. Elsewhere people rely much more on commuter rail services and we want to do the same to ferry people from Katutura and other residential areas in the capital. This project is now earmarked at N$1.2 billion.
Not all of the projects are government projects. Most of them are private projects with private owners, or promoters, who are looking for investment partners to inject additional capital.
New Era: Perhaps you can tell us a bit more about the registration process for Invest Namibia 2016?
Sinimbo: We have launched a website (www.investnamibia.com) and participation in the conference is by registration on this website. We are looking forward to receiving our guests and we request Namibians to demonstrate friendliness during and beyond the conference.
Any visitors to Namibia to date will tell you this is a very friendly country, but we want to emphasise that guests must be received with a smile straight from the port of entry. Investing in a country is about the total package, because the whole picture plays an important role.