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Namibia dazzled by Zimbabwe’s investment prospects

17/01/2018
by Kelvin Chiringa
Business

Namibia has shown keen interest in investing and gearing up trade with Zimbabwe in the event that the latter’s economy takes off.

Following the high profile state visit of the newly inaugurated Emmerson Mnangagwa to Windhoek two days ago, economic advisor to the president, John Steytler said, beyond rhetoric, Namibia will take seriously the idea of engaging with Africa’s former bread basket on agro-based trade.

“In agriculture definitely it could be a great trading partner. Zimbabwe has a comparative advantage in agriculture not only in terms of the climate but also in terms of the machinery that has been developed over a long time. They are really a player, that’s why we used to say Zimbabwe is one of the bread baskets of Africa and I think we can just benefit from learning from Zimbabwe,” he tells The Villager. 

Steylter says Namibia stands to benefit not only from imports but also in terms of skills development as far as the utilisation of agricultural equipment and machinery is concerned.

“The other thing we must also remember is that Zimbabwe has been and still remains one of the countries that has a strong industrial base and we are in the process of industrialising and we need what I call appropriate technologies to industrialise,” he said.

Meanwhile, South Africa remains Namibia’s largest trading partner with an estimated 85% of imports coming from down south. 

Namibia is also still pushing its industrial vision 2030 which envisions the country being the logistical hub of the region and Steytler says an engagement with Zimbabwe allows for the trial of technologies that have been used in the African environment.

Yet the advisor to the president suggests that the economic relations have to be reciprocal, and already Namibia has assisted Zimbabwe with a dry port facility at Walvis Bay, one of the country’s most significant ports.  

“On the other hand, Zimbabwe can also benefit from our infrastructure for the imports and exports. Remember we have made available for many SADC countries that are landlocked the concept of a dry port at the port of Walvis Bay to enable them to become sea-linked.”

“As the Zimbabwean economy recovers there will be more demand for imported goods and that could very well come through Namibia which will have spin-offs for our logistics hub,” explains Steytler.

He adds that Namibia could cooperate well with Zimbabwe in the tourism and hospitality space among a myriad of opportunities given that both economies recover.

Meanwhile, the Namibian economy is struggling to pull out of a 2017 recession which has dragged on into 2018 to the detriment of both private and public sectors.

Zimbabwe has also been bogged in the mud of economic stagnation for a long time now with the economy suffering bouts of sub-normal growth, high shelf-prices, hyper-inflation, an ongoing liquidity crisis that has rendered the central bank not worth of public trust among a host of ills.

Director at the Economic Association of Namibia (EAN), Klaus Schade applauded the opening of the Zimbabwean door to investment but emphasised that the country still has to establish a platform that fosters an investor-friendly environment.

“There are a number of factors when it comes to investment. We need an investment climate in Zimbabwe in particular for foreign direct investment and also trade facilitation although Zimbabwe is part of the SADC trade protocol. They have introduced tariffs and also some additional customer regulation.”

“Zimbabwe used to be the second most diversified economy in southern Africa after South Africa. So if Zimbabwe manages its economy well and stimulate it, there will probably be more demand from neighboring countries. There will be more opportunities also for Namibian businesses to enter the market,” said the economic expert. 

Steytler says Zimbabwe is poised to hold a high profile international investment conference this year.

However, visiting professor at the University of Cape Town, Henning Melber submits that the Namibian-Zimbabwean links were always of more importance politically than economically and is doubtful if this will change much.

By opening arms to Mnangagwa, the professor says, Namibia has rubberstamped the coup which he launched in Zimbabwe with the backing of the military.

“I would assume that Mnangagwa's visit has to be seen also in this light. Namibia's two former presidents attended the swearing in of Mnangagwa and paid afterwards a courtesy visit to Mugabe, and finally reported back to the SWAPO Congress that all is well in Zimbabwe. Namibia then already approved of the 'soft coup,” he says.

Melber adds that the friendly relations among liberation movements as governments will continue.

“Both countries share the interest to be seen by potential foreign investors as having a secure investment climate in a regional stability. Maybe they have discussed the DRC and Kabila overstaying in office, which might bring the country again at the brink of war. Almost 20 years ago both countries (jointly with Angola) intervened militarily and came to the rescue of Kabila senior,” he says.

He submits that SWAPO and ZANU have a close relationship since more than 20 years and the replacement of Mugabe has not changed this.

“I am tempted to assume that the visit of Mnangagwa is more a courtesy call reinforcing the mutual interests than anything else,” he says.