WINDHOEK – President Hage Geingob yesterday confirmed that the fiercely debated 25 percent equity stake stipulated in the National Equitable Economic Empowerment Policy Framework (NEEEF) has been removed.
Its critics, who say the move would restore investors’ confidence, welcomed the removal of the clause.
Geingob confirmed this at the opening of the two-day Economic Growth Summit that started in the capital yesterday. The summit ends today.
However, he was quick to point out that all pillars of NEEEF will remain and be taken into account for enterprises doing business with government and applying for natural resource licensing.
For several years now, the private sector has been pressuring government to remove the clause that would have forced white businesses to sell a 25 percent stake to previously disadvantaged Namibians.
“We have understood concerns raised by the private sector on NEEEF, in particular on the ownership pillar,” Geingob told his audience, to thunders of applause.
“We also are aware that finalising the Bill will provide policy certainty, which in turn should reduce capital outflow and unlock domestic and foreign direct investments,” he added.
With regard to wealth redistribution and creating conditions for inclusive growth, Geingob said government cannot do it alone, adding that income and wealth disparities remain a global and local concern.
“We have one of the most unequal societies in the world, as a result of historic structural exclusion,” Geingob said.
Quoting the Nobel Laureate Professor Joseph Stiglitz, the President said, “the only prosperity that will be sustained is shared prosperity. Prosperity that is not shared will not be sustainable.”
Therefore, Geingob called on those who have benefited historically from Namibia’s economy must therefore be willing to share their gains.
The Head of State said redressing the skewed nature of the country economy is therefore both a political and business imperative.
“Namibians have been politically empowered through the attainment of independence and self-governance. We have, as government, over the last decade commenced the process to facilitate broad-based economic empowerment,” he said.
Geingob says while some previously disadvantaged Namibians have been benefiting from empowerment opportunities, government acknowledges that it has not yielded the desired level of broad-based transformation.
He said in order to equitably redress structural inequality; empowerment opportunities must benefit a wider population.
“I have repeatedly stated that when we speak of poverty eradication and shared prosperity, we are not connoting that every citizen will live in opulence and excess,” he stresses.
He said rather, as author Rick Riordan asserts, “fairness does not mean everyone gets the same. Fairness means everyone gets what they need.”
“Our aim is to ensure we produce a society in which every citizen has equal opportunity to receive the basic requirements for dignified life and to pursue their talents with equal opportunity,” said the President.
Furthermore, Geingob also used the opportunity to provide clarity on the definition of the term ‘Previously Disadvantaged Person’ for the purpose of New Equitable Economic Empowerment Bill (NEEEB).
He said this refers to Namibian citizens that were racially disadvantaged by colonial and apartheid laws and practices before 21 March 1990.
“NEEEB will refer to the need for sector charters. The equity threshold will be determined in the sector charters,” he said.
On the funding mechanism, Geingob said government cannot carry the sole burden of financing empowerment transactions.
“It must be a collective responsibility, including financial institutions, private sector and participating enterprises,” he said.
To this end, he said government commends those businesses that have already completed empowerment transactions, without waiting for the enactment of the law.
“One does not need to be compelled by law to do what is morally correct,” he said.
He said finalisation of NEEEB is one of government’s key priorities and the Bill will be tabled in Parliament within six months.
“As we forge ahead towards a new economic identity that is reflective of a more equitable post-independence Namibia, I should make it categorically clear – that it is not our intent to take away from those who have, but rather to grow the Namibian economy so that more Namibians can own and manage productive economic assets,” the President said.