WINDHOEK – While Namibian products are making inroads on the shelves of local retailers, the growth and share contribution of the manufacturing sector has remained low over the years, and the contribution of manufacturing in real terms reduced from 14 percent in 2010 to 13 percent in 2012.
Equally, the economy performed below expectations in terms of equalizing wealth distribution.
“This is largely attributed to the fact that the structure of our economy has remained narrow and resource-based. Economic growth is still largely fuelled by production and exports from the extractive industries,” noted Minister of Trade and Industry, Calle Schlettwein, while speaking at the Growth at Home conference in the capital last week Thursday.
Schlettwein added that the notion that ‘Namibia consumes what it does not produce, and produces what it does not consume will only be laid to rest through deliberate national policies and interventions which the conference, through stakeholder consultations, is timeously attempting to design to encourage value addition to Namibia’s natural resources.
Commenting on the availability of locally produced goods on the shelves of local retailers, the General Manager of Team Namibia, Lizette Foot, noted: “We want to bring about ‘Growth at Home’ by changing the consumer’s mindset. We need to realize that supporting local businesses has a multiplying effect on many factors such as reducing income inequality and increasing employment.” Encouraging local retailers to start stocking Namibian made products, Foot noted that so far only three of the major retailers are members of Team Namibia.
They are Pick n Pay, Spar and Woermann Brock.
Minister Schlettwein further said: “Solutions to our persistent and perpetual problems of high unemployment, a skew income distribution and poverty may be found by innovative strategies that make the most of our comparative and competitive advantages. The natural endowment in raw materials like minerals, precious and semi-precious stones, agricultural produce, marine resources and fish, to mention but a few should not remain a curse. This endowment must be turned into our competitive advantage. Our economy has to be transformed from one that relies on trading in raw materials only, to a diversified economy that produces value added and finished goods.”
The emphasis of the Growth at Home strategy, spearheaded by the Ministry of Trade and Industry, is on increased value addition to Namibia’s natural resources for greater socio-economic benefits where such resources originate.
This strategy is often referred to as ‘commodity-based industrialization’.
Historically, Namibia’s manufacturing sector has been inhibited by among others, a lack of a serious capitalization for major manufacturing projects, limited access to finance, limited skills availability, high inputs costs, especially utilities and transport, small domestic and market access constraints for export, limited access to production technology and stiff competition from subsidized imports.
“The concept of a value chain is now often used to highlight the importance of increasing our gains from what we produce. The sad reality is that we seldom participate in the upstream part of a value chain and produce the inputs into an extractive or other productive process or in the downstream part of such processes. We generally only participate in the middle part, which is to produce and export raw materials,” noted Schlettwein.
The trade minister added that historically, Namibians, and almost all other African states, have allowed too much of the value chains associated with precious and mostly non-renewable resources to extend beyond their borders.
By Edgar Brandt