Josef Kefas Sheehama
This article attempts to seek out how diversification of the economy will enhance stable and viable economic growth in Namibia.
Namibia still desperately needs to improve agricultural production systems and tackle the threats of climate change and uncertainty. Green hydrogen serves as an alternative but not Alpha and Omega for employment creations.
The director general of the National Planning Commission and chairperson of the green hydrogen Council anticipated that Namibia would create 600 000 jobs through the national green hydrogen strategy that expands on the country’s green ambitions.
The bottom line is that growth in the hydrogen sectors of the Namibia economy will lead to vast new employment opportunities as businesses expand to serve growing markets but will not be a single source of job creation.
Hence, we should diversify our attention across all economic sectors. We are losing major sectors. Agriculture is the backbone of Namibia; without that, everyone is a poor man in Namibia, but no one is thinking of it.
Still, if we lose the agricultural scope and the agriculture, we will face famine, and the cost of living will shoot to an unexpected level.
Most of the people in Namibia are still employed in the agriculture sector and the major employment still depends on agriculture.
So, the focus must be on how to increase the agricultural output. The rate of employment will also increase if the government focuses on this sector.
Therefore, we should accelerate industrial development and job creation by capitalising on the green hydrogen industry, as well as the sub-sectors of oil and gas, and enhancing agricultural production. In my judgement, the total number of 600 000 employment opportunities, through green hydrogen, as stated by the director general, within 17 years, is unrealistic.
Green hydrogen has many obstacles to navigate to reach its full potential and importantly for communities to enjoy the full benefit of cleaner power, commercial opportunities and job growth. There are major obstacles on the path to achieving our hydrogen economy; the path will not be simple or straightforward. The economics of green hydrogen are challenging today, primarily because the underlying costs, skill, knowledge and availability of renewable energy sources vary widely.
I support economic transformation through green hydrogen, but we should be realistic with our projections.
Therefore, the development of a green hydrogen economy will impact positively Namibia’s labour landscape as the country continues to adapt to the Fourth Industrial Revolution (4IR) while, consequently, certain jobs will become redundant.
Furthermore, the net difference will be positive, especially considering green hydrogen. However, we currently do not have all the skills in Namibia to really grow a green hydrogen economy.
But Namibia needs significant investment from foreign or local private companies and the public sector to catalyse growth.
Significant effort needs to be made by an industry to attract investment in addition to driving skills development and policy reviews. Hence, job creation is likely to be relatively low because of the highly specialised and capital-intensive industry green hydrogen production requires. Moreover, given the elevated rate of unemployment and the large number of individuals who are experiencing long spells of unemployment, both fiscal and monetary policymakers should be considering a wide array of approaches for promoting job creation. For this reason, we should not lose focus on other sectors. Balancing all sectors
will start giving exponential
growth to Namibia’s GDP. Therefore, turning the agricultural sector around will require substantial investment and equal attention to capitalise on the growth opportunities.
Experience from around the world indicates that as Namibia continues to grow, more and more people will migrate from the countryside to cities. Hence, an inclusive growth strategy needs to include investments in urban infrastructure as well as programmes to increase urban employment.
It is, therefore, required to build resilience and response mechanisms against adverse events in farming communities and provide social protection for vulnerable groups. Achieving these objectives requires paying particular attention to poorer and less developed regions that mainly depend on agriculture for livelihood.
Rural poverty in Namibia is about three times higher than urban poverty, and most of the rural poor depend directly or indirectly on agriculture for their livelihood.
* Josef Kefas Sheehama is an independent economics and business researcher. He has authored more than 100 articles in economics and business.