Investors pumping massive funds into Namibia

PHILLEPUS UUSIKUThe strong recovery in global commodity prices such a diamonds, uranium, zinc, copper, and tin, which are abundant in Namibia, has strengthened mining investment.According to Shelly Louw, research analyst at PSG, positive foreign direct investment (FDI) momentum was maintained in the third quarter of 2021 as net FDI recorded an inflow of US$93 million compared with a smaller inflow of US$17 million during the previous quarter.Consequently, the cumulative net FDI inflows in the first three quarters of 2021 were US$262 million, which is the best performance since 2018, Louw added.This improvement could be ascribed to the increase in loans granted to domestic subsidiaries by their non-resident parent companies, as well as retained profits, particularly those within the mining industry.About 62% of Namibia’s FDI stock is in the mining and quarrying sector, while nearly 23% is in financial services and about 6% is in the manufacturing sector.The countries with the largest shares of the Foreign Direct Investment (FDI) stock are China (42.9%) South Africa (29.5%) and Mauritius (5.9%), she pointed out.Namibia’s net FDI, on an annual basis, fell steadily since reaching a peak of US$1.05 billion in 2012 and ultimately turned negative in 2019. This period was associated with poor sentiment towards emerging market destinations and a slowdown in FDI flows globally.“This year will see the arrival of Debmarine Namibia’s new US$468 million diamond mining vessel, while other planned revival or expansion projects for gold, zinc, copper, and tin mining also bode well for mining investment in the medium term.Meanwhile, the government’s new green hydrogen policy could also unlock further foreign investments in the renewable energy sector. We forecast net FDI to exceed US$350 million in 2022 which would be the best year for FDI since 2016,” the analyst said.Mining performanceAccording to the Namibia Statistics Agency (NSA), during the third quarter of 2021, the mining and quarrying sector registered a strong growth of 41.9%, compared to a decline of 33.1% recorded in the same quarter of 2020.Meanwhile, the Bank of Namibia (BoN) pointed out that production of diamonds, uranium, zinc concentrate and gold rose, compared to the previous quarter. The rise was mainly due to more carats mined both offshore and onshore as well as high grade ore of uranium, zinc concentrate and gold.Diamond production rose significantly year-on-year by 67.0% to 411 778 carats in the third quarter of 2021.In addition, production of uranium rose by 15.7% from 1 490.6 tonnes during the quarter under review. The rise was attributed to base effects due to the loss of production hours, as a result of technical challenges and water supply issues experienced by one of the mines, during the previous quarter, BoN added.Furthermore, production of zinc concentrate rose both year-on-year and quarter-on-quarter by 5.0% and 8.1%, respectively, during the quarter under review, the central bank said.Lastly, production of gold rose on a yearly and quarterly basis by 53.0% and by 109.4%, respectively. The rise was largely ascribed to a high-grade ore mined during the quarter under review, owing to an improvement in the mineral content in the ore body, after the completion of the strip-mining exercise by the mine during the period under review, BoN said.-phillep@nmh.com.na

Investors pumping massive funds into Namibia

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Republikein 2026-06-16

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Investors pumping massive funds into Namibia

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Republikein 2026-06-16

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