WINDHOEK – The mining sector, which is one of the most important sectors in in terms of Gross Domestic Product (GDP) contributions, will only continue to be an important factor to the domestic economy if new mines are discovered. This is according to Minister of Mines and Energy, Tom Alweendo, who on Friday warned that given the non-renewable nature of minerals, the existing mines will eventually come to a closure.
Speaking at an event hosted by Debmarine Namibia, Alweendo said to discover new mines, a number of things have to happen, the first of which is to have a good understanding of our mineral potential. “We need to have a good knowledge of what minerals are available. One often hears statements that Namibia is rich in minerals. I am of a view that we need to encourage more investment in a comprehensive geological mapping. Without an improved geological mapping, it will rather be difficult to attract investment for mineral exploration. Fortunately, the emerging geological mapping technology has made it possible to obtain accurate mineral resource assessment,” said Alweendo.
The second thing, he said, is for government and the mining sector to do everything possible to attract investment in mineral exploration. “Without exploration, no new mines can be discovered. We also know that exploration is a high-risk investment. When you invest in mineral exploration there is no guarantee that you will discover minerals. It is estimated that the chances that an exploration will lead to a successful mining operation is 1:1000 and the lead time can be as long as ten to twenty years,” said the mines minister.
Alweendo emphasised that in order to attract exploration investment, a periodic review of the country’s mineral licensing legal framework is required. “This is necessary in order to ensure that we continue to be competitive in attracting investment, both local and foreign. For example, it is not helpful when it takes an inordinate long time for us to finalise the processing of licensing applications. It will be self-defeating when we impose impractical licensing conditions; or when our policies are unpredictable thereby creating policy uncertainties,” Alweendo stated.
In 2017, Namibia’s mining sector contributed over 12 percent to GDP, and it is expected that by 2022 the mining sector’s share of the GDP will exceed 15.2 percent. This high contribution to our economy, said Alweendo, suggests that for the foreseeable future, the economy will be dominated by the mining sector.
“Given the impact the mining sector has on the economy, it goes without saying that we need to take good care of the sector. We need to be pragmatic in the management of the sector. We need to ensure that the mineral resources are utilised to the benefit of both the investors and the State,” Alweendo stated.