• December 15, 2023

Namibia’s Mining Regulation a Blueprint for Success

Namibia’s Mining Regulation a Blueprint for Success
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By John Sisay

Namibia’s decision to ban the export of unprocessed ore marks a pivotal shift for the country’s economy – turning it from an exporter to a producer.

The policy encourages the development of local processing facilities, enhancing economic opportunities for many Namibians. It’s a move that ensures mining doesn’t just extract wealth, but also adds value and deepens economic impact, issues that are both central to Namibians.

Old arguments against protecting Africa’s rich resources are dated and are no longer applicable in our modern, globalised economy that will soon have Africa at its heart.

Namibia’s approach to mining regulation stands as a model for success. From efficient administrative processes, to the maintenance of skilled labour, to a focus on sustainability and environmental protection, the country demonstrates a continental blueprint. A roadmap to resource management that is balanced and strategic, and enviable to our neighbours.

The government’s initiative to provide incentives for mining – including the on-time reimbursement of VAT, coupled with a transparent system for acquiring mining licences showcases a commitment to both growth and sustainability. This is the beginning of an inflection point in the local industry, which will see exponential growth in the next 10 years.

Copper mining has played a part in Namibia’s development since 1900. Now, it’s set to catapult growth. Despite challenges like the recent dip in the copper market, Namibia’s rich copper and lithium reserves position it as a key player in the electric revolution.Why? Because copper and lithium are essential to battery production, which will power the electric vehicle and renewable energy storage revolutions.

The country’s clean-power and transport infrastructure, skilled workforce and stable administrative systems bolster Namibia’s abilities and should be seen as highly attractive to investors. Namibia boasts excellent roads, ports and a growing solar power grid, coupled with its educated workforce, makes it an ideal location for mining investment.

To realise the sector’s full potential, substantial investment is needed, particularly in production and smelting infrastructure for sustainable copper and other electric-transition minerals.

Maintaining copper prices above US$10 000 per tonne is also essential to meet the rising demand, especially with electrification and the transition to cleaner energy sources. The new beneficiation policy will support preserving this threshold.

The government’s role in stabilising these prices is vital for long-term planning, protection of the local market and investment in the sector.

The government’s decision to develop a more robust production industry is not only good for Namibia, but also for Africa. The emphasis on developing local supply chains is crucial for the sector’s sustainability and cross-border economic impact.

Foreign investors must reassess their investment approach, moving away from paternalistic instincts and towards a partnership model that respects the autonomy and strategic vision of African states like Namibia. This shift is necessary for the balanced and just utilisation of resources – and empowering a more sustainable business model for Namibia’s emerging economy.

Namibia is also leading the way through its progressive, environmental, social and governance (ESG)-friendly mining practices. The government rightly understands that these are no longer optional, but a cornerstone for the success of any modern mining economy. In Namibia, the focus on community engagement, environmental conservation and social responsibility is not just a compliance measure but a business imperative.

The government has also taken bold steps to preserve Namibia’s environment and agricultural output; passing robust environmental monitoring, especially in water preservation. The government’s rigorous oversight of environmental and social aspects of mining operations ensures responsible and sustainable practices.

The government and the mining sector have outlined a blueprint for other African countries to follow. The blend of resource protection, progressive regulation, environmental consciousness and community engagement positions Namibia as the next frontier for ethical resource extraction.

Together, we have set a public-private standard for others to emulate. Now it’s up to other African states to take on this blueprint and for international investors to take note of its success.

  • John Sisay is the chief executive of Ongopolo Mining and Processing Ltd.

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