DECEMBER, 2019
ENERGY & SUSTAINABILITY News & Analysis
Water Security Still a Challenge
IN THIS MONTH’S ISSUE: Addressing Water Security Concerns for Namibia Japan Funds Water Supply in Kunene Region Meet the RDJ Team of 2019
The NAMIBIA Country Briefing of RDJ Consulting
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C O N T E N T S
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FromTheEditor
Quick Facts
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Economy at Large
Oil & Gas
8 Renewable Energy
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Water
The Environment and Sustainabilty
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Telecommunications
Roads and Transport
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Financing
The RDJ 2019 Team
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Tenders and Careers
Contributing Authors
DECEMBER, 2019
From the editor Water Security Still a Challenge
Dear Reader, It is that time of the year where we all take a look back though the year, and analyze some of our greatest achievements both as a country or as individuals with the New Year bringing hope and renewed energy. For Namibia, there is no doubt that the greatest challenge thus far is the drought. This has affected people, animals and the environment at large. The impact has been so that Climate Change is ever on the lips and the just ended COP25, a mystery as to its impact for 2020. The limited water available is still to be carefully distributed and used wisely to sustain us until fresh sources or rains abound. Thanks go out to the many local and international entities that extended a hand to assist in minimizing the impact of the drought on vulnerable Namibians. What remains is the need for urgent measures to provide water security in the country.
RDJ Consulting Services CC is an advisory consultancy to the Energy, Water and Transport Sectors with a focus on sustainable operations and renewable energy.
PO Box 23738 Windhoek, NAMIBIA Telephone +264 61 400 171 EMAIL briefing@rdjconsulting.co.za WEBSITE www.rdjconsulting.co.za
To know more about these challenges and the achievements, please enjoy this edition, as well as all our previous publications at https://issuu.com/rdjbriefing/docs. Also, you can find in this edition, the RDJ Team that faithfully kept you informed throughout 2019 on page ... of this edition. Further, if you are new to the RDJ Briefing, please subscribe to this FREE Publication at briefing@rdjconsulting.co.za and you may freely share the link with others that will benefit from its contents. Enjoy….
( David A. Jarrett) Editor
Authors RDJ Interns*
This report is a FREE Publication and was prepared by RDJ Consulting Services CC based in Windhoek, Namibia. The content is collected from publicly available information and so its accuracy cannot be guaranteed.
quick facts Population size: 2.3 Million Employment: 66.6% Literacy rate: 89.0% GDP Growth (2018): -0.1% Repo Rate: 6.50 % Interest rate (Prime): 10.25% Inflation (CPI): 2.50% Industries: Tourism, Mining, Fishing Telecom (sophistication): LTE Mobile - cell phones: 2.575 million Subscribers Water availability: 8 800 000 cubic litres/capita Electricity Gen. (Local): 484.000 MW Electricity Demand (all): 629.000 MW www.rdjconsulting.co.za
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DECEMBER, 2019
economy at Large A Repo Rate and its Usefulness – The Namibia Context
The Repo Rate in Namibia and Local Control
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he Bank of Namibia plays a crucial role in ensuring economic and financial stability. This is done through the monetary policy and despite the peg of the Namibian Dollar to the South African Rand, which means that the country surrendered its rights to having a complete independent monetary system, the country still sustained some level of monetary policy discretion as the government through the Bank of Namibia is able to maintain its repo rate at levels different from that of the repo rate set by the South African reserve bank. The goal of the monetary policy is to ensure price stability in the interest of sustainable growth and development. The level of monetary discretion that is sustained allows us to use sterilisation operations, capital controls and regulatory barriers to influence, to a certain degree, short term interest rates, money supply and, possibly, credit extension to the private sector in order to control domestically induced inflation through expectations and aggregate demand. Namibia uses capital controls and prudential requirements imposed on banking and other financial institutions. This then allows BoN to maintain a repo rate different from that of the South African Reserve Bank (SARB). The Bank of Namibia’s Monetary Policy Committee (MPC) met 6 times this year (2019) to discuss the Repo rate and the latest meeting (also, last meeting of the year) was on the 4th of December in which they decided that it will remain unchanged at 6.50 percent. The repo rate remained unchanged during the first quarter but was reduced by 25 basis points to 6.50 during the fourth meeting of the MPC in August 2019. The reason behind the
Author: Naemi Shoopala Economist and Researcher RDJ Consulting
maintained interest rates now is to stimulate growth in a context of low inflation, support domestic activity as well as to maintain the one-to-one link between the Namibian dollar and the South African rand.
About Repo Rates and its Relation to Business and Opportunities Technically, repo stands for ‘Repurchasing Option’ or ‘Repurchase Agreement’. The repo rate is the rate at which the Commercial Banks borrow from the Central Bank, and it therefore in turn determines the interest rates at which consumers are charged by their banks. The Reverse repo rate is the rate at which the Central Bank borrows money from Commercial Banks. The Bank of Namibia (BoN) acts as the banker of Commercial Banks. When Commercial Banks experience a cash shortfall or a need for daily liquidity, their lender of last resort is Bank of Namibia. The system through which banks borrow from the Central Bank is called the Repurchase Transaction System (repo system).
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DECEMBER, 2019
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OIL & GAS NAMCOR Enters Namibia’s Fuel Retail Market Fully
Image Source: neweralive.na
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he National Petroleum Corporation of Namibia (NAMCOR) which is a legally enacted entity under the Namibian Companies Act of 1973 with the Government of the Republic of Namibia as their sole shareholder, is ready to make its long awaited debut fully into the fuel retail market, following the official opening of its first fuel station at Hosea Kutako International Airport. NAMCOR has made the decision to compete in the fuel market and the entire petroleum value chain to emulate the example of other national oil companies. NAMCOR’s downstream strategy is to establish and secure strategically located fuels and lubricant distribution networks, as well as sales infrastructure to boost the company’s brand and provide world-class service to their valued customers and business partners. With this mandate, NAMCOR took a decision to enter the retail fuel business by setting up retail fuel outlets (petrol service stations) in Namibia. They believe there is still more scope for better margins in the retail sector.
December Fuel Prices
CEO, Immanuel Mununga said that it is a common practice worldwide for national oil companies to dominate their own domestic markets. The Hosea Kutako filling station will be followed by others at Oshakati, Karasburg, Opuwo, Swakopmund and Rundu. Mununga believes the company has been operating below its potential weight. The HKA retail site is one of the three sites that they have started. The second one is at Ongwediva (it has already started trading) and the third one is at Otavi which is nearing completion. More retail sites are expected within the next 12-18 months.
Readings https://www.namcor.com.na/news/231-namcor-brandlaunch-press-statement https://www.namibiansun.com/news/namcor-wants-todominate-fuel-market2019-11-22/
The Ministry Of Mines and Energy announced that the December Fuel Prices remained unchanged. Therefore, the prices are as follows: 95 Octane Unleaded Petrol: N$ 13.05 per litre Diesel 50ppm: N$ 13.63 per litre
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DECEMBER, 2019
RENEWABLE ENERGY Finding Avenues to Make Electricity Less Costly in Namibia RDJ Photo
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s part of the 2019-2023 strategic business plan, with a view of reducing tariff to consumers, NamPower plans on setting up a 220-megawatt (MW) wind power-generating plant between Elizabeth Bay and Kolmanskop. This was said by the minister of Environment and Tourism during his visit to the proposed site of the project. Underway, are plans to erect a 20MW PV power plant, 40MW wind project, 40MW biomass power project and a firm project as part of NamPower’s 150MW allocation of the total 220MW. Keeping in mind that the power plant will be within the Tsauseb//Khaeb (Sperrgebiet) National Park, it will be set up with precautions to avoid any damage to the biodiversity and environment.
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Another prominent figure that NamPower’s principal engineer mentioned was a wind power plant at a cost N$1 billion which will becarried out in two separate projects. NamPower has been given the duty to carry out 150MW of the total 220MW, while the remaining 70MW of 220MW will be an independent plant that will be put up for bidders.
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DECEMBER, 2019
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WATER Addressing Water Security Concerns for Namibia RDJ Photo
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amibia's persistent drought has developed into a great concern for everyone. In May 2019, the President of Namibia had to declare his second drought emergency since taking office, and by September 2019 over 700 000 people countrywide (more than a quarter of the population) needed food aid. The drought has wiped out a significant number of livestock and destroyed crop yields. Water supply in Windhoek has been threatened to the point that the City of Windhoek had to urge the residents to be mindful and vigilant in their water use to maintain consumption to within the target level. Despite the rainy season approaching now, of which SADC Climate Services Centre reported Namibia to have received positive rainfall outlook, there is still a great need to strengthen Namibia’s water resources in order to reduce the damage caused by the drought due to uncertain weather patterns. In support of this, the Minister of Finance has assured that the government is taking the necessary steps in ensuring security supply of water, so the country never runs dry.
Although the 2019/2020 national budget presented by the Minister of Finance does not make provision for the building of a desalination plant, which is Namibia’s biggest solution to re-occurring droughts, the Minister revealed that part of the N$2.5 billion loans that the government secured from the African Development Bank (AfDB) will address water security concerns. He said “The N$2.5 billion is a loan facility that we have in principle agreed with the African Development Bank to supplement the development of necessary water infrastructure. The project will cover the whole country to make sure that we do not run dry. It includes desalination”.
Use Wisely
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10 DECEMBER, 2019
THE ENVIRONMENT & SUSTAINABILITY Promoting Sustainable Namibia
Ecotourism Development
and in
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n order to promote development of the tourism sector in Walvis Bay, the Walvis Bay Municipality in conjunction with industry players and Stakeholders met at a forum in November 2019 to exchange views, develop partnerships, share experience and educate each other on the subject matter.
Namibia’s Wild Horse Population Increases
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ue to a management plan that was launched at Lüderitz in November by the Ministry of Environment and Tourism, its partners and stakeh-
-olders, the population of horses in the Namib-Naukluft Park and the Tsau //Khaeb Sperrgebiet) National Park is steadily increasing. According to the minister of tourism and environment, the plan is designed to maintain a viable and healthy horse population that contributes to improving community livelihoods and economic development for the country. Before implementation of this plan, the horses were under threat of extinction as their population was drastically reduced due to predators, particularly hyenas that target the foals. In May 2019, there were only 77 horses by the number increased to 79 in November 2019 and is estimated to further grow to 100 soon.
The theme of the forum was: “Promoting Ecotourism and Sustainable Development While Capturing Emerging Trends”. Other than strategizing industrial growth of tourism, information on how to make the sector ecofriendly through policy makers and regulations was discussed. According to the general manager for community and economic development at the Walvis Bay Municipality, the tourism industry through innovation and cooperation of its industry players has the potential to facilitate economic investment, partners’ development and employment creation. He added that the Namibian tourism industry should be updated with global standards while maintaining its originality and competitiveness. Other issues discussed included the need for professional tour guides as they have potential to make or break the industry, as well as the consideration of cultural tourism, where tourists can meet with the communities and be educated about the different cultures and towns through the locals. According to Walvis Bay Namibia Chamber of Commerce and Industry (NCCI) president, the tourism industry directly contributes with about N$7 billion to the country's Gross Domestic Product every year and a further N$15 billion indirectly. Thus, forums of this kind are highly welcomed as they foster inter-relationships between businesses within the tourism sector.
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DECEMBER, 2019
Plastic Bag Levy Proves Fruitful
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RDJ Photo
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n as much as plastics are very helpful in our day to day activities, their disposal remains a great threat to our natural environment while harming plants, anim-als and humans. Plastics have toxic pollutants that make its decomposition take hundreds or thousands of years. Due to the overuse of plastic, there has been an issue of plastic pollution all over the world and countries have taken it upon themselves to try and find a solution to this problem. In Namibia, the Ministry of Finance introduced an environmental Levy on plastic bags in October 2019. This was after an amendment of regulations which was released in the government gazette in august 2019. A fee of 50 cents is charged to consumers for plastic bags and the money collected goes to the Environmental Investment Fund of Namibia who then uses it in the fight against climate change. Asa result, the new levy has affected consumers negatively and local plastic producers as well as the environment positively. According to the managing director of Plastic Packaging, a local manufacturer of plastic bags Nico du Plessis, the demand for plastic bags has reduced significantly. The reduction is associated to the levy imposed on carriers which is more than the cost of one bag. This subsequently increases the cost of carriers by more than 100%. Plastic Packaging which is a wholly Namibian-owned company has employed 500 Namibians and with new technology it aspires to increase recycling volume over 20% by 2020, while increasing the variety of commodities it recycles. According to the Chief Executive Officer (CEO) of another local manufacturing company called Namibia Plastics (PolyNam,) an even bigger change in attitude towards plastic is needed. This is because the firm intends to invest about N$100 million in its recycling plant which will require increasing its workforce from 37 to 109. The Firm’s CEO added that with the advancement of technology, plastics may be taken back, recycled and reused, thus promoting social fairness, job creation, and economic growth and overall promoting a clean environment.
Currently, a fee of 50 cents is charged to consumers on every plastic bag purchased, and the money collected is secured by the EIF, who then uses it in the fight against climate change.
Pick n Pay to Dispose of its UCO through BEE Biofuel Manufacturing
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ith the focus of improving our environmental sustainability, Pick n Pay (PnP) Namibia which is under Ohlthaver & List (O &L) Group signed a contract with Be Energy Efficient (BEE) Biofuel Manufacturing to safely dispose of all its Used Cooking Oil (UCO).
According to the managing director of BEE Biofuel Manufacturing, the use of used cooking oil which is a common practice is very dangerous to both human and animal health, as it may cause cancer, stroke, Parkinson’s and many more diseases. BEE uses all UCO in the production of non-food products, like biodiesel, soaps and compost. PnP Namibia in turn, purchases the manufactured biodiesel from BEE for use in its diesel ovens to bake bread. This is a safe process as waste oil from their kitchens is turned into a reusable product, while at the end producing zero waste to the environment. This way, Pick’n Pay hopes turn to contribute towards a safer and healthier environment, while at the same time supporting BEE.
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12 DECEMBER, 2019
NMP Engages the Public on Safety of its Phosphate Mining Project RDJ Photo
Bauxite Mining Gantry - No Relationship to Phosphate Mining
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amibia Marine Phosphate (NMP) is developing a world class phosphate project off the coast of Namibia that will establish Namibia as a premier rock phosphate producer in the global market, contributing significantly to the Namibian economy and supporting ongoing crop production through the provision of phosphorus for fertilizer. The company has a current and valid Mining License ML170 that was issued in 2011 for a period of 20 years covering the mineral reserves and resources defined in the Sandpiper phosphate deposit.
conference on the 11th of November 2019 at which they claimed their phosphate mining project will not have a significant impact on the environment and the fishing industry. They outlined the transparency of the processes they have undertaken so far to support their claims. They responded to specific questions in relation to the Project processes and related environmental impacts which included issues regarding the transparency of the environmental impact assessment (EIA), the dredging process, the handling of materials onshore and the toxicity of phosphate rock.
During the month of September 2019, over 1000 people, mostly workers in the fishing industry at Walvis Bay massively protested against Marine Phosphate Mining and urged the government through a petition to not grant prospective miners an environmental clearance certificate. There are about 16 000 workers in the fishing industry, and concerns are that seabed mining for phosphates will inflict irreversible damage to Namibia's lucrative fishing industry, which is a pillar of the country's economy. In the 19-page petition presented to the office prime minister, numerous scientific, economic and high environmental concerns were pointed out. The contribution expected from mining activities towards the aforementioned sectors are not believed to be worth the risks involved as it rather compromises economic, environmental and social endeavors. Protesters are adamant that phosphate mining has negative impacts and have demanded the government to make laws that ban out phosphate mining at sea.
NMP said the project has been assessed by qualified environmental professionals. According to NMP, the EIA and the Environmental Management Plan (EMP) were compiled in compliance with the requirements of the Environmental Management Act 2007 and the conditions of Mining Licence 170 (ML170). A total of 26 specialist reports have been completed to assess various aspects of the potential environmental impact of the proposed dredging operations in ML170. In addition, 37 independent experts from a range of environmental consultancies have contributed to the environmental studies completed as part of the ECC application process.
In response to the claims, NMP management held a media
Readings http://www.namphos.com/ https://www.namibian.com.na/192900/archiveread/Fisheries-workers-against-marine-phosphatemining https://www.namibiansun.com/news/nmp-allaysphosphate-fears2019-11-12/
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Photo illustrating minin RDJ Photo
Bauxite Mining Stockpile
14 DECEMBER, 2019
TELECOMMUNICATIONS MTC Invests in Technology for a Wider Reach
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o test, construct and display its new business and customer applications MTC Namibia opened the first-ever Information, Communications and Techn-ology Innovation Centre in Windhoek during an official launch ceremony. Speaking at the launch, MTC Namibia’s acting chief executive officer said that the centre will be concentrated on fostering endeavour-based services from exhaustive fibre internet and digital cloud-computing services to lead digital changes in the smartphone and smart city initiatives. The centre which is a physical space for digital and physical tools is expected to bear the fruits of innovation as it is planned to be home to new ideas, research and development. With MTC Namibia’s mission to stay updated with technology and improve new structures on its grid structure, the company also launched a TubeStar Macro Base Station at Osona Village. According to MTC Namibia, this is a new type of transmitter base station, a first of its kind and is made to benefit the rapidly growing population of Osona for now and the entire country soon. A TubeStar Macro Base Station is a single-pier hollowed structure which allows the entire components of the tower to be integrated within the hollow single-shaft tower, and not around it, as is the norm. This new Macro Base Station addresses issues related to
high urban macro site deployment costs, difficult site acquisitions and poor deployment efficiency, and also reduces civil work and site rental costs. It has the potential to generate an estimated 40% total cost of ownership reduction in five years and features two m2 footprint, which is 90% lower than that of traditional macro base stations (30 m2 to 60 m2) and can effectively assist telecom operators to assume an early lead in 4.5 G and 5G construction. According to MTC's corporate affairs manager, the latest innovation uses up 75% less space than the old base station, making it easier to offer services in urban settlements where land allocation is usually a challenge. There is also the need for perimeter walls around the base transmitter station which requires extra infrastructure incorporated within the tower as MTC no longer needs a dedicated tower, cabinet and equipment room at each site. Although costly, the all-in-one and environmentfriendly technology sums up convenience.
Readings https://www.namibian.com.na/85774/read/MTC-opensinnovation-centre https://www.namibian.com.na/85729/read/MTC-erectsnew-technology-base-station
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DECEMBER, 2019
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ROADS AND TRANSPORT Phase 2 of the Aminuis - Aranos Road Construction is Commissioned RDJ Photo
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he second phase of the construction of the bitumen road between Aminuis and Aranos was commissioned on the 19th of November 2019 at Onderombapa by the Minister of Works and Transport. The road is a glimmer of hope for the Omaheke region given its high concentration of both commercial and communal farming practices, this will help connect farmers to local and international markets. The road links part of the Trans-Kalahari Highway, which links the harbour at the port of Walvis Bay in the Erongo region to South Africa via Botswana. It was therefore identified by the government as an important catalyst in promoting regional competitiveness, trade and investment with the entire SADC region. In addition to the benefits, the road is also expected to unlock tourism potential. The upgrading of this road that connects Omaheke and Hardap regions is set to commence early 2020 with an estimated job creation of about 400 Namibians. This will also create benefits to the surrounding places such as schools and clinics within five radius kilometres.
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15 DECEMBER, 2019
FINANCING
RDJ Photo
Funding Received Relief in Namibia
for
Drought
Japan Funds Water Supply in Kunene Region
arious donations were made to the Dare to Care fund that was established in response to the president’s declaration of a state of emergency on the drought ravaging the country. The companies who assisted in raising the initial N$10 million target for fodder subsidies to assist drought-stricken farmers are outlined below.
he rainy season has approached and it is starting to look promising for this year’s water cases but until water bodies are filled and people have easy access to water, the drought effects are still intact.
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Capricorn Group and Capricorn Asset Management donated N$200 000; Engen connected with the Dare to Care Foundation and pledged to contribute five cents for every litre of petrol purchased from Engen service stations in Namibia between June 1 and August 31; Ombaye Fishing, a fishing company, has donated a sum of N$100 000; Saroa Lodge rolled out N$371 000, and this was the biggest contribution made; Pioneerspark Primary School donated N$12 323; Otjiwarongo Motors & Tractors contributed N$10 000; and Gelbvieh Vereniging contributed with N$8 352. Readings https://kundana.com.na/posts/dare-to-care-fundbrings-relief-amid-national-crisis https://www.namibian.com.na/85915/read/Capricorncontributes-to-drought-relief-fund https://www.namibiansun.com/news/ombaye-fishingboosts-dare-to-care-fund2019-06-25/
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The Kunene region received N$1.2 million from the Japanese government to fight these effects as part of the drought relief projects. These funds are meant to benefit about 480 households by improving their access to clean and safe water with the rehabilitation of 16 water points, distribution of purification tablets and water storage containers as well as conducting training on WASH (Water, Sanitation and Hygiene) and malnutrition surveillance. The funding is granted through Japan's Grant Assistance for Grassroots Human Security Projects (GGP). The GGP aims to bring about a direct and immediate impact on the well-being of disadvantaged communities at the grassroots level by supporting relatively small development projects such as health, education and agriculture to be implemented by non-profit organisations and local authorities. The Japanese government has been implementing the GGP in Namibia since 1997 and have supported a total of 54 projects to the cost of N$37.5 million to-date.
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Meet Our 2019 Team
THANK YOU FOR YOUR
Mr. David Jarrett Director / Managing Consultant RDJ Consulting
Ms. Lahja Amaambo Advisor / Policy Specialist RDJ Consulting
Ms. Naemi Shoopala Economist & Researcher RDJ Consulting
Ms. Priscila Chilombo Olga Manager Operations / Internships RDJ Consulting
Ms. Misozi Mugala Economist & Researcher RDJ Consulting
Ms. Monique Jarrett Envionmental Intern (UNAM) RDJ Consulting
Ms. Kina Indongo Marketing Intern (UNAM) RDJ Consulting
Meet Our 2019 Team
FULL SUPPORT IN 2019
Mrs. Renee Jarrett Director RDJ Consulting
Ms. Gabriella Bock Marketing & Communications Officer RDJ Consulting
Ms. Selma Taapopi Marketing Intern (College of the Arts) RDJ Consulting
Ms. Olivia Joan De-Celestino Marketing Intern (IUM) RDJ Consulting
Mr. Sakaria Johannes Statistics Intern (NUST) RDJ Consulting
Mr. Fares Shipaxu Economist & Researcher RDJ Consulting
Mr. Peter Haufiku Statistics Intern (UNAM) RDJ Consulting
20 DECEMBER, 2019
TENDERS City of Windhoek (CoW) Tender Name/Description: Consultancy services Wastewater treatment design and contract management.
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Tender Name/Description: Consultancy services for bulk sewer and reticulation design and contract management. Tender Name/Description: Supply and delivery of Electrical stock items 2 (two) yearly. Tender Name/Description: Supply and delivery of traffic signal Heads, traffic lights signal modules, yearly caps and other traffic light accessories for the city of Windhoek (Two yearly bid). Closing Date: 21st January 2020.
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Tender Name/Description: Construction of water reticulation services for Ourab informal settlement, Rotsvesting: Kamanjab Bidding reference number: W/ONB/KVC-01/2019. Closing Date: 10th January 2020 at 12:00hours.
Helao Nafindi town Council Tender Name/Description: Waste collection and Removal for Helao Nafindi town council. Closing Date: 2nd January 2020 at 12:00
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Update
DECEMBER, 2019
CONTRIBUTING AUTHORS
David Jarrett (Managing Consultant) RDJ Consulting Services CC Priscila Chilombo Olga (Economist) RDJ Consulting Services CC Naemi Shoopala (Research Intern) RDJ Consulting Services CC Misozi Mugala (Research Intern) RDJ Consulting Services CC
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