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Mining companies directed to buy local… some still buying from outside to the detriment of local suppliers

2021-09-02  Edgar Brandt

Mining companies directed to buy local… some still buying from outside to the detriment of local suppliers

Edgar Brandt

Although the total value of goods and services procured by the Namibian mining sector during 2020 was about N$12.3 billion, a significant portion of the local procurement amount still goes to foreign-owned Namibian registered companies. 

This is according to mines and energy minister Tom Alweendo, who yesterday said “this gap needs to be breached” in the industry that contributes about 10% to Namibia’s GDP.

Alweendo was the keynote speaker at the official opening of the Mining Expo and Conference, which due to Covid-19 is taking place virtually this year under the theme: ‘The Namibian Mining Industry’s Resilience and Growth Post Covid-19’. 

“If we are going to continue to play an instrumental role in ensuring that the sector becomes a catalyst for economic development, we need to ask ourselves some tough but necessary questions about our future as an industry,” said the mines minister. 

The Namibian mining industry accounts for about 50% of the country’s exports and Alweendo said he believes mining must look towards building resilience in its value chains from suppliers to downstream customers. 

“Section 50(d) of the Minerals Act stipulates that mining companies may only procure goods and services abroad if such goods or services are not available in Namibia. Today, mining companies are still procuring from foreign companies outside of the country, while local companies could potentially provide such goods and services,” Alweendo lamented. 

He noted that even though the local procurement figure looks good on paper, there is still a difference between Namibian registered companies (foreign-owned) and Namibian owned companies. 

It is for this reason the Ministry of Mines and Energy, together with the Chamber of Mines are developing a database for local inputs. The database will serve the industry by providing a platform for local suppliers to meet the needs of mining companies and for mining companies to procure from locals. I urge you all to provide your inputs into the database as it is developed,” said Alweendo. 

Acknowledging the devastating impact by the pandemic on the global and domestic economies, Alweendo added that when compared to other sectors, the mining industry came out mostly unscathed by Covid-19. 

“No one ever thought that one-day that either mining activities would have to slow down or that non-essential operations would have to be put-on-hold until further notice. The Namibian mining industry employs a workforce of 14 591 directly, making it very vulnerable to the pandemic because if companies failed to safe-guard their workforce, this would mean we would have failed the socio-economic development of our country,” Alweendo stated.  

He continued that despite the unprecedented situation of Covid-19, the collaboration between stakeholders resulted in operations continuing under the lockdown period. 

Said Alweendo: “The Ministry of Mines and Energy made sure that the mining industry remained recognised as an essential service and for all mines to adhere to Covid-19 regulations”. 

He added that as the economy and the nation rebounds stronger from the Covid-19 crisis, he is immensely proud of how the mining sector responded to the pandemic, where operations continued and employees remained safe. 

“Namibia’s mining companies remained resilient and performed on all fronts whilst at the same time enhanced their social license to operate, strengthening their obligation in supporting their employees and communities in which they operate. Amidst the slowdown, the pandemic showed the need for mining companies to be good corporate citizens. During this time, the industry heeded government’s call to support national efforts in the fight against Covid-19. On record, Chamber members collectively donated about N$77.9 million towards various national and local efforts,” Alweendo pointed out.  

He continued that the mining industry and society need to assess, re-think and transform the way work is done, stating that a core set of collaborative actions are required from all key stakeholders, which will include government and labour. 

“These actions should look at lives (health and safety), livelihoods (jobs and income) and learning (education and skills). Through these lenses, companies can identify practical actions to continue to be good corporate citizens. As the industry gets back to normal, we should all remember that both government and mining companies have huge responsibilities towards the communities where they operate and if need be, beyond that,” said Alweendo. 

2021-09-02  Edgar Brandt

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