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Itula urges royalties rethink

2022-04-05  Loide Jason

Itula urges royalties rethink

The leader of the Independent Patriots for Change Panduleni Itula yesterday asked government to review its policy on royalties for natural resources.

Itula paid a courtesy visit to President Hage Geingob to discuss the country’s envisaged green hydrogen project as well as to understand what the government is doing to revive the economy.

The IPC president warned the government not to be too excited about the green hydrogen project because of its long-term benefits but to instead concentrate on short-term solutions that will reduce poverty and revive the struggling economy.

Itula said Namibia imports the majority of its energy and asked how green hydrogen will help the country to become more energy self-sufficient.

President Geingob told Itula that green hydrogen is a new project, and the government wants to start from scratch in creating job opportunities by doing consultations.

 He also reminded him the private investors own 90% of the resources legally, while the government got a tax regime and collects its share through royalties and company taxes.

In October 2021, Namdeb, the diamond-mining joint venture between the Namibian government and De Beers, agreed lower royalties until 2025, with the rate cut to 5% from 10%.

Both Shell and French oil major TotalEnergies recently made significant light oil discoveries offshore southern Namibia. 

Government, through the National Petroleum Corporation of Namibia (Namcor), owns 10% in each venture.

“There is an agreement in place that is signed. The government have no money for discovering the oil. These are private investors, and they are using their own money to do that,” said Geingob.

However, Itula said the government should make use of institutions and geological frameworks in place to research and discover its resources such as oil to create jobs.

“We have high unemployment, and we need to find a solution to that effect. Now, if the 90% shares are going to the investors, how are we going to revive our economy,” he questioned. 

He also wanted to know why the government is not making use of the national development plan to address the issues of unemployment among the youth, instead of getting excited about the green hydrogen, which will create over 32 000 jobs after a decade.

The National Planning Commission head, Obeth Kandjoze, said green hydrogen is a new project, and government is consulting with the public to make it successful.

Ndjoze also indicated there is a petroleum agreement that is already signed for more than 20 years and needs to be respected. 

According to him, the government got a tax regime and collects its fair share.

The secretary general of IPC, Christine Aochamus, also urged the government to consider interim relief on fuel levies.

“Most people lost their job due to Covid-19; food prices and fuel are increasing – can the government look into the policy on the levies to relief the people because it will increase poverty in the country,” she suggested.

Prime Minister Saara Kuugongelwa-Amadhila said there are committees entrusted to review the policy on the levies for submission to cabinet.

“Within a few months, we will be able to know the findings, but it will not be an easy situation because the revenue of the country has declined. We need to be purposeful to deal with this matter,” she said.

President Geingob has in recent weeks hosted political parties to consult on the government’s green hydrogen project.

Itula’s IPC and other opposition parties managed to upset the ruling Swapo in the capital city and the Erongo region during the last regional and local council elections. 

Pic: IPC 







2022-04-05  Loide Jason

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