The proposed National Upstream Petroleum Local Content Policy, which aims to promote skills development, local ownership and supplier opportunities for Namibians in the petroleum sector, is actually “designed to establish an enrichment conduit for the politically connected.”
This is according to the management committee of the Economic Policy Research Association (EPRA), which advocates for pragmatic job creation and reducing inequality of opportunity.
In a statement issued on Wednesday, EPRA, which was established eight years ago as a voluntary association that advocates for pragmatic, sustainable, pro-growth and investment friendly economic policies, argues that the proposed local content is actually designed to establish an enrichment conduit for the politically connected.
This, the association stated, is despite the local content policy being aimed at procurement of local goods and services in the oil and gas industry. EPRA stated the policy is dressed up to create the impression of benefiting a broad base of Namibians.
“As with previous policies, the proposed Local Content Policy focuses on ‘previously disadvantaged Namibians’ and not ‘currently disadvantaged Namibians’. The difference between previously and currently disadvantaged Namibians is those Namibians who used to be poor (previously disadvantaged) but are now rich (not currently disadvantaged),” EPRA stated.
The association added that ‘previously disadvantaged’ Namibians is the same group that has benefitted from fishing quotas, from mining deals, from GIPF mandates, from land deals, from farms, from Agribank loans, from DBN loans, from board membership and from government tenders.
“This is the same group that was meant to benefit from NEEEF and the Investment Promotion and Facilitation Bill, where government also refused to replace ‘previously disadvantaged’ with ‘currently disadvantaged’, as this would exclude the already-wealthy politically connected,” the association added.
The Office of the President is currently conducting a nation wide consultative process on Namibia’s proposed National Upstream Petroleum Local Content Policy that was in principle approved by Cabinet towards the end of last year. Consultations are scheduled to continue across the country until 17 September to provide sufficient time for input.
On Monday this week, //Kharas governor David Gertze stressed the importance of inclusivity and shared prosperity, while deputy head of the Upstream Petroleum Unit, Carlo McLeod, reaffirmed government’s commitment to collaboration, skills development, job creation and local business empowerment.
Meanwhile, the African Energy Chamber (AEC), which serves as a voice of the African energy sector, has commended the Namibian government’s proactive stance on local content and its dedication to empowering local communities while maintaining a welcoming environment for foreign investment.
“It is clear that the policy is designed to balance the interests of local stakeholders with the needs of international oil companies, a model that other African nations can look to for guidance,” the AEC stated.
Speaking at the recent third Namibia Oil and Gas Conference in Windhoek, lawyer Shafimana Shimakeleni warned that there is no offence or specific penalty prescribed in the existing legal framework for non-compliance with the local content policy.
Shimakeleni pointed out that despite assurances, the policy will guide oil companies on how to source goods, services and skills locally, stakeholders warned there is an absence of clear penalties for non-compliance.
Also, the Institute for Public Policy Research (IPPR) has emphasised that Namibia should undertake a series of critical measures to ensure transparency and good governance in the emergent oil and gas industry.