Aupindi proposes mining dividends be paid in commodities instead of cash

Swapo Party MP Dr Tobie Aupindi has urged the government to receive dividends from mining and energy companies in physical commodities rather than cash.

Speaking during a debate on the 2026/27 Appropriation Bill on Tuesday, Aupindi argued that this would safeguard Namibia's national wealth and give the state greater control over its resources.

“In a world of rampant inflation, why shouldn’t the government explore receiving its dividends in physical commodities for a strategic commodity reserve and for trading?” Aupindi asked. 

He added that for decades, Namibia's mineral and natural resources wealth has been converted into fiat currency, which is subject to inflation and the whims of global central banks. 

"I am calling for the Commodity Dividend Model,” he said.

In an interview with Namibian Sun yesterday, Aupindi elaborated on how the model could transform Namibia’s economic standing. 

He said the country risks remaining a net exporter of raw materials unless it builds its own reserves. 

“Countries that don’t even produce certain minerals stockpile them for strategic economic interest. But also, remember, this is for tourism, one side you are creating a reserve for future economic stability, and also for future generations,” he said.

Manipulation

Aupindi stressed that receiving dividends in commodities would allow the government to trade directly in global markets rather than relying on corporate cash dividend declarations, which can be manipulated through accounting and operating expenses. 

“If you get the actual commodity, you will have an opportunity to build up your reserve, number one, you will also have an opportunity to trade it, as you wish it, and you could even engage the highest bidder to trade those commodities,” he said.

He further highlighted the potential for industrialisation through holding commodities. 

“When you have the actual commodity, you can dictate the value chain. The value chain includes many activities, such as beneficiation, which adds value to you. You can create more industries because you will have the commodity. 

"You can attract the technological know-how and start training your people in actually dealing with the commodity itself, rather than just getting it out of the Cash dividends underground and sending it out,” he said.underground and sending it out,” he said.

Cash dividends 

Aupindi tied the model to broader economic challenges, including public debt and the budget deficit. 

“The debt right now is about N$193 billion, literally about 67 % of our GDP. Now, where are the growth areas in our economy? Literally in retaining our commodities and being able to attract other forms of economic formula, which is around industrialisation through a value-addition scheme, and therefore be able to now export our commodities in terms of an economic benefit,” he said.

He also warned that relying solely on cash dividends leaves the country vulnerable. 

“Even if you get a dividend from a company, by the time it gets to you as a government, it has already lost value. It is subject to various macroeconomic factors. 

"The commodity itself endures irrespective of whether the price of that commodity is up or down that day. As long as you are able to do that, we are stronger than just having paper money.”

Mining companies in Namibia are estimated to have contributed about N$6.97 billion in taxes, royalties and export levies in the 2025/26 financial year, according to calculations based on figures from the finance ministry and the Chamber of Mines of Namibia.

Royalties from diamond mining are projected to fall from N$1.157 billion in 2024/25 to about N$755.7 million in 2025/26, reflecting the global diamond market downturn.

Royalties from non-diamond minerals, including uranium, gold and base metals, are expected to remain relatively stable, increasing slightly from N$1.033 billion in 2024/25 to about N$1.057 billion in 2025/26 as production and sales from other mineral commodities offset weakness in the diamond sector.

Export levy collections are estimated to have increased by 14%, rising from N$560 million in 2024/25 to about N$639 million in 2025/26.

Royalty-in-kind

Aupindi's idea is akin to what several resource-rich countries do by receiving part of their mining or energy royalties in the form of the commodity itself, rather than cash, a system commonly known as royalty-in-kind. 

This approach is most prevalent in the oil and gas sector, where governments take a share of produced crude and then sell it directly on international markets. 

Countries such as Angola, Nigeria, Azerbaijan and Kazakhstan receive portions of oil production through production-sharing agreements, allowing the state or national oil companies to market the crude themselves. In North America, the United States and Canada’s Alberta province have also used royalty-in-kind systems, in which governments can receive royalties in physical oil or gas rather than monetary payments. 

The model allows governments greater control over resource marketing and can increase revenues if managed efficiently.

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