Namibia’s exports to China has exceeded imports since the year 2018.
There are various other African countries that achieved this by exceeding exports more and its imports from the world’s fastest economy.
In 2019, exports to China were valued at US$1.6 billion, dominated by refined and unrefined copper at 62%, followed by a composition of uranium, lead and zinc ores for 36%.
Copper exports were valued at US$986 million, which means more than 65% of Namibia’s copper exports are destined for China.
Uranium exports were valued at US$566 million, which means more than 75% of Namibia’s uranium exports are destined for the eastern economy.
China overtook South Africa as the main destination for Namibia’s export products since the year 2017.
By exporting more products to China, Namibia’s overall trade balance has become stable compared to many years of being a net importing nation.
The country’s trade balance was a (negative) US$350 million in 2015 and increased significantly to a positive US$1.3 billion in 2019.
The pros and cons of growing exports (according to economic blogger Brandon Gaille) leads to increased domestic job creation, access to assets for the exporting nation, lowers the value of the country’s currency and which makes local products more affordable in comparison to imported goods, creation of free trade and a dynamic business position, reduction in government spending, higher levels of Foreign Direct Investment (FDI), technology transfers and lastly can lead to higher tax revenue.
Subsequently, Namibia should capitalise on this position in order to grow its ownership in such strategic sectors by acquiring more local equity and to create opportunities through beneficiation.
The Ministry of Mines and Energy in partnership with the Namibia University of Science and Technology (Nust) and the Chamber of Mines has developed a Minerals Beneficiation Strategy (MBS) to discover ways in which more value can be derived from the mining sector and various mining minerals in order to boost the domestic economy, this will enable a long term benefit to sustain jobs, skills and technology transfer for the benefit of all Namibians and not just the developed nations.
Most importantly sectors should focus on specialised skills and education which will equip more locals and professionals to pursue opportunities in mineral extraction, marketing, exporting and manufacturing at graduate or globally competitive levels.
China’s Guandong Nuclear Power Holding Corp has strengthened its position by owning 90% shares of the Husab Uranium Mine of which the Namibian government owns 10%.
China National Uranium Corporation acquired 69% ownership of Rossing Uranium and the Namibia government owns three percent but with more voting rights.
Namibia’s main copper exporters include the Tschudi Mine, Dundee Precious Metals, Ongopolo, Namibia Custom Smelters, etc.
Traded mining products are sensitive to commodity prices and therefore does directly change GDP growth or primary sector outputs, unless if there is a radical boost on local manufacturing, leading to the expansion of the secondary and tertiary sectors of the economy.
*Rodney Dan-Ao !Hoaeb is a trade and investment researcher who prays for Namibia’s economic emancipation.
2020-09-23 09:50:00 | 29 days ago