The SEZs a key policy instrument for Nam
The policy aims to create industrial hubs and technical skills development, and enhanced developmental impact of the SEZ regime.
25 November 2021 | Economics
We are pleased to note that, the policy is finalised, draft bill is also finalised internally. Elijah Mukubonda, Spokesperson: MIT
The Special Economic Zones (SEZs) are a key policy instrument that is deployed to ensure the attainment of economic goals as set out through the industrialisation path. It provides a valuable platform to enable structural change through infrastructure development and streamlined regulatory mechanisms that yield significant economic benefits such as sectoral investments, employment creation, strengthened value chains as well as enhanced regional industrial cooperation.
SEZs are essentially geographically defined areas usually being administered by a single body and offering conducive incentives for enterprises to locate and operate. The incentives are usually for a defined period and may be both financial and nonfinancial in scope. They provide more liberal laws than what may be found in the general economy, pertaining to labour, customs and investment procedures and land use.
The national SEZ policy expands and subsumes the existing Export Processing Regime (EPZ) by strengthening key provisions such as expanded sectoral focus as well as a clear monitoring and evaluation framework. The ultimate outcome of the policy is to bring about successful industrialisation.
The policy title emphasis ‘sustainable’ to ensure that SEZ’s should be inclusive, lead to sustainable development and re-emphasize that Namibia was the first country in the world to observe the need for environmental sustainability in her Constitution.
The policy builds on experience from the existing incentives regimes and proffer appropriate strategies on zone administration and the creation of appropriate institutional frameworks. The policy furthermore, calls for the promotion of Private Public Partnerships (PPP) in zone development.
This policy is developed within the presiding global policy space whilst ensuring adherence to the national agenda embedded in various policies and development frameworks. Further, the development of the policy is through a consultative process with the aim to ensure that it is fit for purpose for our national developmental trajectory. Ultimately, the aim of this policy development is to ensure alignment to our national objectives of stimulating industrialisation, structural transformation of the economy, total factor productivity and the attraction of both sustainable FDI and Domestic Direct Investment (DDI).
The SEZ policy is to be reviewed every five years by the Ministry of Industrialisation and Trade (MIT), in order to incorporate new market dynamics and developments. However, MIT may at any interval and from time to time make changes, modifications, additions to this policy in order to meet changing needs of industry.
Given the pedestrian growth of our manufacturing sector over the years, high regional inequality as well as the low sectoral productivity levels, a National SEZ policy becomes an imperative. The SEZ Policy signals to both domestic and foreign investors our readiness for doing business, building key strategic sectors whilst adhering to sustainability principles. The SEZ policy also pivot towards ensuring our laggard regions’ development, community sustainability and inclusion whilst maintaining fiscal credibility.
The need to attract both foreign and domestic investment, increase exports, foster employment creation and act as a catalyst for structural transformation and industrialisation are among the motivating factors for the new policy. SEZ are useful in addressing policy key constraints such as limited access to serviced land, poor quality infrastructure and high regulatory constraints on investment and business operations.
The overall objective of the SEZ policy for Namibia is to create a modern regulatory framework governing economic zones to attain structural transformation of the economy, inclusive and sustainable growth and job creation. The SEZ policy thus aims to provide the requisite policy and implementation frameworks to ensure the development of inclusive, competitive, dynamic and innovative Namibian economic zones.
We are pleased to note that, the policy is finalised, draft bill is also finalised internally. The initial timeline was set for 2023, however, the timeframe has been shortened and the policy is expected during the first quarter of 2022. The policy is expected to translate into law after incorporating public consultation inputs.
The SEZ expects to yield a regulatory framework that optimise the development and attainment of an inclusive SEZ regime in Namibia, a regionally balanced operations of SEZ across Namibia, and attraction of both qualitative and quantitative investments into the SEZ across both industrial and services sectors.
It further expects to foster key cross-border regional and bilateral value chains development through SEZ, create industrial hubs and technical skills development, and enhanced developmental impact of the SEZ regime.