Namibia has a significant urban population, 70% of which live in the north. Northern-central and north-eastern areas like Oshakati are experiencing an enormous urbanisation trend. The majority of Namibia’s youth lives in the northern regions. This means that the country is in need of investments to meet the needs of the young population as well as the rising urban middle class.
Investment opportunities
Investment in Namibia is an excellent option for those who want to make profits and establish an office in the country. As one of Africa’s smallest nations, Namibia has a small population, but a growing urban middle class. The absence of a huge government means that companies can draw on their strengths to gain advantage of the rapid growth of the economy in Namibia. In addition to being rich in natural resources, Namibia also offers a low tax rate, and also has an extensive infrastructure for foreign investment.
The country is currently going through an ambitious program of infrastructure renewal. Investment opportunities in Namibia may take the form of public-private partnerships or equity holdings. Some of the current key areas of interest are power generation as well as transmission, logistics and water infrastructure. Opportunities are available in the construction and maintenance of rail and road infrastructure, as well as in affordable housing. When investing in Namibia ensure that you choose a reputable bank. The government is seeking partners to help it realize its ambitious plans.
The country has a wealth of natural resources that can assist investors make the most of their investment. Large Chinese companies have invested in the mining industry as have South African businesses in the diamond and banking industries. Spain and Russia have made substantial investments in the fishing industry. Other countries have expressed desire to explore oil in Namibia’s waters. Opportunities for FDI include logistics, manufacturing and angel investors south africa mining. FDI in Namibia is the ideal place to begin in order to maximize your investment.
Challenges
The start-up ecosystem in Namibia hasn’t been successful in connecting entrepreneurs with the appropriate investor. Entrepreneurs are often drawn to poor investors that can cause more harm than good. An ideal investor will provide time, access and capital to start-ups. New investors will be limited to the right connections and lack of knowledge of market conditions. Namibian investors need to be cautious when deciding which projects to fund.
The investment climate in Namibia has seen rapid improvement in recent years, however the country still faces significant challenges. Namibia has a low domestic market, a limited pool of skilled labor, and high transport costs. Despite these challenges, the country is currently expanding its vaccination program. This will help reduce bottlenecks in production and open tourism. The government has placed its top priority on attracting foreign investment, Investors Looking For Projects To Fund – 5Mfunding reducing the high rate of unemployment, angel investors south africa as well as diversifying the economy.
There are numerous opportunities to FDI to Namibia. Many large Chinese companies have made significant investments in Namibia’s mining industry of uranium. Canada and South Africa are also significant investors in Namibia with substantial holdings in banking and mining. The Office of the President is also looking to develop renewable energy sources. Other areas which are highly desirable include mining and tourism which are the majorstay of the nation’s economy. The general trend is for the price of commodities to rise over the next years, which will allow more companies access private equity.
Government support
The Namibian government has acknowledged the bureaucratic processes that could hinder ease of doing business and is currently working on addressing these issues. The Investment Promotion Act is currently under review, and this new law is likely to replace the old Foreign Investment Act. While the new act is aimed at attracting foreign investment, those looking to finance projects in Namibia must be aware of its specifics. A business owner might not be able to access information about a project, including the financial situation of the owner.
The Registrar of Companies manages Namibia’s companies and regulates the formation of businesses. While registration is required investors are encouraged to seek advice from the Namibia Investment Centre. The Namibia Investment Centre provides services to investors starting in the early inquiry phases to operations. It also offers information on projects, incentives, as well as procedures. The investment center streamlines processes and coordinates with regulatory and other government agencies. This enables investors to focus on projects that will benefit the country.
While Namibia’s private sector heavily depends on bank financing however, the banking sector is quite weak in terms of funding new businesses. Many commercial banks in Namibia adhere to the standard lending practices which require businesses starting out to guarantee collateral in exchange for loans. Unsecured lending is restricted and bank loans are often risky. Additionally, the government’s support for investors looking to fund projects in Namibia is not sufficient.
Financial institutions
You’re not the only person looking for an ideal project in Namibia. The Namibian government as well as a variety of financial institutions are looking to help economic development as well as private sector development. The Development Bank of Namibia (DBN) held a recent stakeholder meeting that revealed Namibia requires more than grants to fund. Public-private financing is vital to increase productivity, modernise customs and offer access to information for free. The panel concluded that, among other things that transparency and good corporate governance are essential.
There are a variety of investors in Namibia. The Development Bank of Namibia (or Start-Up Namibia) are two examples of public funders. This initiative promotes the start-up community in Namibia. These funders are more diverse and may be focused on grants or concessionary loans instead of equity investments. These funders might be suitable if you have a significant social impact and are in the early stages of your company. It is important to remember that government funding can restrict the way that companies can operate.
Although Namibia has no privatization plan there are discussions of privatizing state-owned companies. For instance the Government Institutions Pension Fund has committed 340 million dollars to private equity funds in the past decade. It has been mandated to finance infrastructure as well as small and medium-sized company development, and large municipal services. The government has also recently announced plans to sell a portion of its stake in state-owned airline Air Namibia. The government plans to reduce its debt using the proceeds from the sale.
Taxes
Although Namibia does not have an exclusive tax system for foreigners, Namibia has a number of tax-friendly features that could be appealing to investors. One is that foreign companies cannot avoid paying Namibian dividend tax that is a 10 percent tax on dividends coming from Namibia. There is no tax on securities in Namibia. However, investors must be aware that certain capital gains can be taxed as normal income. Third, Namibia is a member of the Common Monetary Area and its dollar is pegged against the South African rand. Additionally, certain sectors require that a certain percentage be local for projects they finance.
The Namibian financial system is reliable and transparent. Namibia is a member of the Common Monetary Area (a group of southern African nations). As such, the remittances of foreign currency to Namibia have been averaging less than one-fifth of the country’s GDP over the last decade, as per World Bank Development Indicators. The majority of Namibian remittances get processed by commercial banks. The BON has not altered its investment remittance policies over the past few years.
Economic empowerment
This article will assist investors seeking projects to finance in Namibia. The Namibian government is the owner of an array of businesses. These companies are known as parastatals, and they contribute more than 40 percent of the GDP. They are largely unprofitable, however they receive subsidy from the government. Joint ventures are typically financed by foreign investors, which has hindered their expansion.
In terms of public policy the government is generally transparent. It publishes its annual budget as well as mid-term reviews in the Government Gazette and consults with interested parties while preparing its budget. It also releases the government’s debt position both contingent and explicit. The fiscal framework of Namibia is generally free of corruption. And the Namibian government does not impose forced localization requirements. The government’s policies promote local content and encourage local ownership of state-owned companies.
The government of the country is trying to improve its financial market and draw foreign capital. The SDG Investment Fair brings together Investors looking for projects to fund – 5Mfunding from different sectors to invest in sustainable development projects for developing nations. Namibia’s Hydrogen Commissioner as well as Economic Advisor are represented by the President. Both are members of the Common Monetary Area (CMA). This agreement allows capital to flow freely between the two countries. Investors from all over the world are invited attend the event to view the current investment opportunities in the country.
Water sector
In Namibia, the water sector has been allocated about 25 percent of the budget for Namibia. To achieve this the Government of Namibia has set up a Namibia Water Sector Support Program to draw foreign investors. The goal of the program is to develop infrastructure related to water and provide potable water to the nation. The government is currently looking for international investors as well as private sector companies to help fund the program. The African Development Bank Group has granted a grant to the government.
There are many opportunities for investment in Namibia’s water sector. EOS Capital is one of these firms. It recently announced that it had completed its initial funding round of the Euphrates Agri Fund, raising 90 million Namibian dollars. Cherry Irrigation Namibia was the fund’s first investment. The firm plans to invest more in the country’s water infrastructure, as well as in the agriculture sector.
Green bonds are a viable alternative to traditional bank lending , and there is a huge market in Namibia. AFD has launched a Namibian green financing label, which encourages local commercial banks to expand their green lending operations. The Bank Windhoek is currently working to create a pipeline of green financing projects and is considering a second issue. A Green Bond works in a similar manner to a non-convertible debenture, however, the major difference is that these bonds are not secured by physical assets, but are backed by reputation of the issuer as well as the document indentures.
