I’m leaving Namibia better off - Geingob

President Hage Geingob says he will be leaving Namibia in a far better state than he inherited, but admitted that the infancy of his presidency was a terrible period.

He made the remarks while meeting Dundee Precious Metals president David Rae, who paid a courtesy call to State House yesterday to announce his company’s acquisition of the Two Hills project from Osino Resources Corporation, in a transaction totalling N$3.9 billion.

Geingob said the project was what Namibia was looking for, adding that economic prospects had not been rosy for a while.

“We hear you are going to create jobs and so on. That is what we are looking for. As I said the other day, the future is bright,” the head of state remarked.

“It was terrible, seven, eight years ago. Terrible, terrible... but now I am going to leave the country in a very good shape,” Geingob told Rae.

Stuttering performance

Geingob has had a tumultuous time in office since becoming president in March 2015. His administration has blamed its stuttering performance on drought, the global economic recession and the Covid-19 pandemic.

Unemployment increased during his term, while the construction industry, which has traditionally helped create unskilled and semi-skilled jobs, has been in negative growth for successive quarters since 2016.

Namibia has been on Fitch Ratings and Moody's junk heaps since 2017, two of the biggest credit rating agencies in the world. Public debt has also increased, standing at N$149.3 billion at the end of September. This represents 64.1% of gross domestic product (GDP).

Getting better

However, last week, the Namibia Statistics Agency (NSA) announced that the domestic economy has recorded its best third quarter since at least 2014, growing by 7.2% in real terms.

Data showed that the past quarter was also the fifth best quarter overall since 2014. The past quarter’s growth was only surpassed by the last quarter of 2014 (10.6%), the first quarter of 2015 (8.2%), the first quarter of 2022 (9.8%) and the first quarter of this year (8.3%). Only four sectors contracted in the last quarter: Manufacturing (-8.7%), construction (-30.6%), public administration (-1.1%) and health (-4.0%).

In nominal terms, nearly N$59.75 billion flowed through the economy in the past quarter – about N$3.8 billion more than the previous quarter and N$6.8 billion more than the third quarter of 2022.

Year of revival

Geingob dubbed 2023 the ‘year of revival’, and said he feels this pronouncement has come to pass.

“I termed this year the year of revival, [and] everywhere I go, I see the signs of revival, so I was a good predictor,” he said.

Rae informed Geingob that the Twin Hills project is expected to generate N$9 billion in revenue for treasury in the form of royalties and taxes, while the total investment in the project was anticipated to be between N$6 billion and N$7 billion.

Twin Hills is expected to generate N$700 million on a yearly basis in tax revenues and taxes throughout its 13-year production period, Rae highlighted.

Apart from that, at least 75% of the project’s operational expenditure was targeted for Namibia.

“We anticipate 75% of the spend for consumables will occur in Namibia, and that is going to be N$663 million per year, so all in all, a significant investment.”

The project aims to employ 550 people in the construction phase, and 870 once the mine is commissioned.