Mines and Energy Minister, Tom Alweendo said the answer to the question about whether or not the oil discovery is a blessing or a curse depends on what Namibia decides in the present.
“The impact will be what we decide it to be,” Alweendo said.
He was addressing a Parliamentary workshop on Maximizing mining and energy potentials, held in Swakopmund on yesterday.
“We know of countries where the discovery of oil became a curse and there are also countries where the discovery became a blessing. I would like to believe that we all want our discovery to be a blessing rather than a curse. However, for it to be a blessing depends mostly on our policy environment, especially our institutional and political aspects of it,” Alweendo added.
Alweendo explained that it has been proven that countries with strong institutions, a stable political system and an effective legal framework, were able to manage their oil revenue with a positive impact on their economies and for the benefits of their citizens.
“That is why our President, Dr. Hage G. Geingob, has always emphasized the virtues of systems, processes, and institutions,” Alweendo added.
He has since emphasized that Namibia’s institutions, political system, and legal framework are such that there is no reason why the oil discovery should not be a blessing.
“What we need to do, however, is to manage the resources with a clear understanding that the resources belong to both the current and future generations. Necessarily, therefore, the management of the resources must benefit both generations,” the minister reiterated.
In addition, Alweendo said the revenue that will accrue to the State through various taxes such as income tax and royalties, the local economy stands to gain more from local content.
“Local content is the value that the extraction of oil brings to the local economy beyond the resource revenues. This value will be obtained from the provision of ancillary services to the oil sector. Among these are the provision of services such as engineering, logistics, accommodation, and catering. Some of the services can readily be provided by local businesses, while others might take a while before our local businesses are able to provide such services,” Alweendo stressed.
At the same event, Erongo Governor, Neville Andre in his welcoming remarks said the policy, legal and regulatory framework governing the energy, mining, and oil sectors in Namibia ought to be fixed, including the effectiveness of the governance mechanisms in place for these sectors, including oversight, monitoring, and enforcement.
“There is also a cardinal need for the review of the policies and practices relating to the environmental and social impacts of the mining, energy and oil activities in Namibia,” Andre said.
He added that It is his hope that the workshop identifies the various challenges and opportunities for improving the governance of these sectors and the sustainable management of natural resources in Namibia.