EDITORIAL: Oil safeguards must be more than good intentions

Government deserves credit for trying to build safeguards around Namibia's emerging oil and gas industry before the first barrel is produced.

This is precisely the time to erect the fences. Once billions of dollars begin flowing through the sector, it will be much harder to repair weaknesses that should have been addressed from the outset.

The proposed amendments to the Petroleum (Exploration and Production) Act, which would compel senior officials responsible for the upstream petroleum sector to declare their assets and financial interests, are therefore welcome.

The same applies to the new National Upstream Petroleum Local Content Policy. Requiring companies bidding for petroleum contracts to disclose their beneficial ownership and shareholding structures is an important step towards preventing fronting.

We must not allow a situation where Namibians are paraded as shareholders, directors or partners while the real owners and beneficiaries sit elsewhere.

These safeguards matter because Namibia has a unique opportunity to learn from the experiences of other resource-rich countries where natural wealth exists but citizens remain trapped in poverty due to elite capture of state resources.

But there is a reason for caution. Our greatest weakness has never been a shortage of policies. We are quite capable of producing impressive legislation, regulations and policy documents. Our Achilles heel is implementation.

These measures must be enforced without fear or favour, including against politically connected individuals and powerful companies.

The other concern is whether the proposed penalties are serious enough to deter misconduct in an industry expected to involve billions of dollars.

A maximum fine of N$20 000 for violating conflict-of-interest provisions appears almost laughable when the potential financial rewards from corrupt conduct could run into millions. What incentive does a person have to respect a law if the potential benefit from breaking it dwarfs the punishment?