This week, Namibia and Germany signed three grant agreements of over N$380 million. The funds, financed by the Federal Republic of Germany through KfW Development Bank, are to be utilised for the water sector infrastructure (Ohangwena groundwater system and technical assistance for NamWater) and urban development, specifically for informal settlements upgrading.
The agreement was signed on Monday, 2 December 2024, and was witnessed by Obeth Kandjoze, director general of the National Planning Commission, Erastus Uutoni, urban and rural development minister, Calle Schlettwein, agriculture, water and land reform minister, Abraham Nehemia, chief executive officer of NamWater, Ulrike Metzger, head of cooperation from the German Embassy and Beatrice Lucke, country director of KfW Development Bank. The three grants signed total some EUR20 million, which at current exchange rates is equivalent to approximately N$383 million.
German Development Cooperation funding for Namibia since 1990 amounts to EUR1.6 billion or approximately N$32.3 billion. The KfW portfolio under current implementation comprises more than 40 projects with a total funding volume of EUR788.6 million (about N$15.4 billion), while future projects with a total funding volume of EUR123 million (some N$2.4 billion) are under preparation.
As the driest country in Sub-Saharan Africa, with more than 80% of its land area covered by desert or semi-desert, Namibia regularly experiences extreme and prolonged periods of drought, as is currently the case. This results in a highly sensitive water supply situation, which requires precise management, the rehabilitation and expansion of supply infrastructure, as well as management of existing water resources and the development of new ones.
It is estimated that between 600 000 and one million people (25 to 40% of the population) live in a total of 230 informal settlements in Namibia. At the National Land Conference of 2018, former president Hage Geingob declared the situation in informal settlements in Namibia a national emergency and a humanitarian crisis. The lack of ownership and official land titles often prevents residents from investing in their land, building permanent homes and improving their economic situation. Additionally, some people live without or with very rudimentary infrastructure, with no access to running water, electricity or sanitation. The government has recognised these critical issues facing the country in its strategic objective set out in the Harambee Prosperity Plan II.
Ohangwena Aquifer Climate Resilient Water Supply Project
Currently, most areas in the eastern Ohangwena region and northern Oshikoto region have not yet been connected to any centralised water distribution systems and water is sourced from decentralised traditional wells, individual boreholes and accumulated rainwater in pans/channel systems (oshanas). However, these water sources are under significant pressure and their water quality is often not high, thus presenting a public health hazard.
The project, therefore, aims to develop the Ohangwena groundwater system in a sustainable manner by installing multiple smaller, decentralised abstraction, treatment and distribution systems throughout the area. The goal is to improve water supply resilience, manage water resources effectively, and adapt to climate change impacts. A total number of 40 000 people are expected to directly benefit from improved access to drinking water, especially those vulnerable to climate change effects.
The total cost of the project is estimated at EUR25.2 million (N$483 million) and will be financed by the EUR10 million grant (N$192 million) provided by the German government through KfW deal, signed on 2 December 2024, as well as by funds from an additional loan for a second phase of the Water Sector Support Programme (WSSP 2).
Accompanying measures to WSSP 2
According to the German embassy, a concessional loan for the financing of a second phase of the national WSSP 2 in the amount of EUR75 million (N$1.4 billion) is expected to be signed soon. In order to ensure an adequate execution of these important investments, the German government via KfW provides NamWater with grant funding in the amount of EUR3 million (N$57 million) to support project implementation.
Furthermore, an accompanying measure will include capacity building measures for NamWater in very different areas such as considering energy efficiency and solar PV in the planning and design of water projects, as well as training for NamWater’s water monitoring and operational staff.
Urban development fund phase 1
The objective of the project to be financed under the urban development grant, is to improve living conditions in and for selected urban informal settlements through the provision and sustainable use of upgraded
and integrated infrastructure. The target group is the low to ultra-low-income groups, who do not otherwise have access to serviced land and land tenure.
Upgrading concepts are to be elaborated by the urban and rural development ministry and local authorities with the participation of the local population in order to reflect priorities, not only regarding basic needs but also regarding perspectives for economic development. Together with reliable infrastructure services (water, electricity, mobility and access to commercial centres), this bears the potential for local economic development.