HomeReportsBureau of Economic and Business Affairs2022 Investment Climate Statements…Namibia

# 					2022 Investment Climate Statements: Namibia			

 In this section										/

													Executive Summary											

                -  Executive Summary 
                -  1. Openness To, and Restrictions Upon, Foreign Investment                    -  Policies Towards Foreign Direct Investment 
                  -  Limits on Foreign Control and Right to Private Ownership and Establishment 
                  -  Other Investment Policy Reviews 
                  -  Business Facilitation 
                  -  Outward Investment 
                -  2. Bilateral Investment and Taxation Treaties   
                -  3. Legal Regime                    -  Transparency of the Regulatory System 
                  -  International Regulatory Considerations 
                  -  Legal System and Judicial Independence 
                  -  Laws and Regulations on Foreign Direct Investment 
                  -  Competition and Antitrust Laws 
                  -  Expropriation and Compensation 
                  -  Dispute Settlement                      -  ICSID Convention and New York Convention 
                    -  Investor-State Dispute Settlement 
                    -  International Commercial Arbitration and Foreign Courts 
                  -  Bankruptcy Regulations 
                -  4. Industrial Policies                    -  Investment Incentives 
                  -  Foreign Trade Zones/Free Ports/Trade Facilitation 
                  -  Performance and Data Localization Requirements 
                -  5. Protection of Property Rights                    -  Real Property 
                  -  Intellectual Property Rights 
                -  6. Financial Sector                    -  Capital Markets and Portfolio Investment 
                  -  Money and Banking System 
                  -  Foreign Exchange and Remittances                      -  Foreign Exchange 
                    -  Remittance Policies 
                  -  Sovereign Wealth Funds 
                -  7. State-Owned Enterprises                    -  Privatization Program 
                -  8. Responsible Business Conduct                    -  Additional Resources 
                  -  Climate Issues 
                -  9. Corruption                    -  Resources to Report Corruption 
                -  10. Political and Security Environment   
                -  11. Labor Policies and Practices   
                -  12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs   
                -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                -  14. Contacts for More Information:   

## Executive Summary

The Namibian government prioritizes attracting more domestic and foreign investment to stimulate economic growth, combat unemployment, and diversify the economy. The Ministry of Industrialization and Trade (MIT) is the governmental authority primarily responsible for carrying out the provisions of the Foreign Investment Act of 1993 (FIA). The MIT is working on new business legislation, the Namibia Investment Promotion and Facilitation Act, but the legislation is still in draft form. As a result, the FIA remains the guiding legislation on investment.

The FIA calls for equal treatment of foreign investors and Namibian firms, including the possibility of fair compensation in the event of expropriation, international arbitration of disputes, the right to remit profits, and access to foreign exchange. The government emphasizes the need for investors to partner with Namibian-owned companies and/or have a majority of local employees to operate in country.

The mining, fishing, and tourism sectors have historically attracted significant investment in Namibia. There are large Chinese foreign investments, particularly in the uranium mining sector. South Africa has considerable investments in the diamond mining and banking sectors, while Canada has investment in gold, zinc, and lithium mining. Spain and Russia have investments in the fishing industry. Foreign investors from the United Kingdom, the Netherlands, the United States, and other countries have investment in oil exploration off the Namibian coast. Logistics, manufacturing, and mining for diamonds and critical minerals such as gold lithium, and uranium also attract investment.

The investment climate in Namibia is generally positive. Despite global economic disruptions caused by the COVID-19 pandemic, Namibia has maintained political stability and continues to offer key advantages for inward Foreign Direct Investment (FDI), such as an independent judicial system, protection of property and contractual rights, good quality physical and telecommunications infrastructure, and easy access to South Africa and the region. Namibia is upgrading its transportation infrastructure to facilitate investment and position itself as a regional logistics hub. An expansion at Walvis Bay Port concluded in 2019, renovations at Hosea Kutako International Airport are ongoing, and there are plans to extend and rehabilitate the national rail line, notably to improve connection from Walvis Bay port to neighboring countries. Namibia has the best roads on the African continent, according to the World Economic Forum. Namibia also has access to the Southern African Customs Union (SACU, which is also headquartered in Namibia), the Southern African Development Community’s (SADC) Free Trade Area, and markets in Europe and Asia. With the second highest solar radiation in the world and vast land and wind resources, Namibia is also positioning itself to be a global leader in renewable energies and green hydrogen, with potential to improve local and regional access to energy and efforts to combat climate change.

Factors that may inhibit FDI into Namibia are the country’s relatively small domestic market, high transport costs, high energy prices, and limited skilled labor pool. Corruption is a problem but not endemic. A recent scandal in the fishing sector resulted in the arrests of ministers and business leaders, cost Namibia around a billion USD, and strained public trust.

As a post-apartheid country with one of the highest rates of inequality in the world, Namibia continues to look for ways to address historic economic imbalances. Proposed legislation, the New Equitable Economic Empowerment Bill (NEEEB), which has been in draft form for more than a decade, will look to create economic and business opportunities for disadvantaged groups, including in the areas of ownership, management, human resource development, and value addition. Parliament aims to pass the bill in 2022, but further delays are possible.

							1. Openness To, and Restrictions Upon, Foreign Investment					

### Policies Towards Foreign Direct Investment

The Namibian government welcomes increased foreign investment to help develop the national economy and benefit its population. The Foreign Investment Act of 1993 (FIA) currently governs Foreign Direct Investment (FDI) in Namibia and guarantees equal treatment for foreign investors and Namibian firms, including the possibility of fair compensation in the event of expropriation, international arbitration of disputes between investors and the government, the right to remit profits, and access to foreign exchange. Investment and tax incentives are also available for the manufacturing sector. The government prioritizes investment retention and maintains ongoing dialogue with investors, including through investment conferences, international events such as the Dubai Expo, and high-level meetings with investors. The government is cognizant that some of its bureaucratic processes (such as the time it takes to get a business visa) impede the ease of doing business and is working to address such challenges. The Namibian Investment Promotion Act, which would replace the FIA, has been under review since 2016.

The Namibia Investment Promotion and Development Board (NIPDB) housed in the Office of the President, serves as Namibia’s official investment promotion and facilitation office. Established in 2020, the NIPDB is tasked with assisting investors in minimizing bureaucratic red tape, including obtaining work visas for foreign investors, by coordinating with government ministries as well as regulatory bodies. The NIPDB is the first point of contact for potential investors and offers comprehensive services from the initial inquiry stage through to operational stages. The NIPDB also provides general information packages, coordinates trade delegations, and assists with advice on investment opportunities, incentives, and procedures. The NIPDB is headed by a highly regarded chartered accountant, and analysts agree that it is doing a better job at facilitating investment compared to past investment promotion mechanisms. The NIPDB website is https://nipdb.com/.

### Limits on Foreign Control and Right to Private Ownership and Establishment

Under the FIA, foreign and domestic entities may establish and own business enterprises and engage in all forms of remunerative activities. The Ministry of Home Affairs, Immigration, Safety, and Security grants renewable and non-renewable temporary employment permits for a period of up to 12 months for skills not locally or readily available. However, work permits and long-term residence permits are subject to bureaucratic hurdles and are hard to obtain for jobs that could be performed by a Namibian. Complaints about delays in renewing visas and work permits are common.

Foreigners must pay a 10 percent non-resident shareholder tax on dividends. There are no capital gains or marketable securities taxes, although certain capital gains are taxed as normal income. As a member of the Common Monetary Area, the Namibian dollar (NAD) is pegged at parity with the South African rand.

There are no general mandatory limits on foreign ownership, but some sectors have a mandatory joint ownership between a local firm and foreign firm, such as in the natural resources sector. Government procurements usually also require a variable percentage of local ownership.

Post is not aware of any investment screening mechanism recently introduced by Namibia.

### Other Investment Policy Reviews

Namibia has not undergone any third-party investment policy reviews in the last five years by the OECD, WTO, or UNCTAD. The Southern Africa Customs Union (SACU), of which Namibia is a member and host, was last reviewed by the WTO in 2015.

In the past five years, several think tanks – such as the highly regarded Institute of Public Policy Research (IPPR) and the Economic Policy Research Association (EPRA) – have provided reviews of investment policy-related concerns, including on the draft Namibia Investment Promotion and Facilitation Bill, which prompted the government to reconsidering the bill’s passage. Links to some examples: https://ippr.org.na/wp-content/uploads/2019/04/IPPR-Improving-the-Business_WEB.pdf; https://www.epra.cc/wp-content/uploads/2022/01/EPRA-report-on-2021-INVESTMENT-BILL-FINAL.pdf

### Business Facilitation

Foreign and domestic investors may conduct business in the form of a public or private company, branch of a foreign company, closed corporation, partnership, joint venture, or sole trader. Companies are regulated under the 2004 Companies Act, which covers both domestic companies and those incorporated outside Namibia but traded through local branches. To operate in Namibia, businesses must also register with the relevant local authorities, the Workmen’s Compensation Commission, and the Social Security Commission.

Most investors find it helpful to have a local presence or a local partner in order to do business in Namibia, although this is not currently a legal requirement, except in sectors that require a joint venture partner. Companies usually establish business relationships before tender opportunities are announced. Some accounting and law firms provide business registration services.

The Business and Intellectual Property Authority (BIPA) is the primary institution which serves the business community and ensures effective administration of business and intellectual property rights (IPRs) registration. BIPA serves as a one-stop-center for all business and IPR registrations and related matters. It also provides general advisory services and information on business registration and IPRs. Website: http://www.bipa.gov.na/.

### Outward Investment

Namibia provides incentives for outward investment mainly aimed at stimulating manufacturing, attracting foreign investment to Namibia, and promoting exports. To take advantage of the incentives, companies must be registered with MIT and the Ministry of Finance. Tax and non-tax incentives are accessible to both existing and new manufacturers. The list of Namibia’s investment incentives can be found online at: https://www.namibweb.com/tin.htm. Namibia is in the process of creating Special Economic Zones (SEZs) to offer favorable conditions for companies wishing to manufacture and export products. The planned SEZs would replace the old Export Processing Zone regime.

							2. Bilateral Investment and Taxation Treaties					

There is no bilateral investment agreement between the United States and Namibia. In 2008, SACU (of which Namibia is a member) signed a Trade, Investment, and Development Cooperation Agreement (TIDCA) with the United States. Information on Namibia’s Bilateral Investment Treaties (BITs) can be found online at: Namibia | International Investment Agreements Navigator | UNCTAD Investment Policy Hub.

There is no taxation treaty between Namibia and the United States. Namibia has double taxation agreements with several countries. Details can be found online at: https://taxsummaries.pwc.com/republic-of-namibia/individual/foreign-tax-relief-and-tax-treaties#:~:text=In%20the%20event%20that%20Namibia,the%20specific%20DTA%20are%20met.

In September 2021, Namibia signed the *Multilateral Convention to Implement Tax Treaty Related Measures to Present Base Erosion and Profit Shifting,* making it the 96th jurisdiction to join the Convention. The government is also party to the Inclusive Framework’s October 2021 deal on the two-pillar solution to global tax challenges, including global minimum corporate tax.

							3. Legal Regime					

### Transparency of the Regulatory System

Namibia’s legal, regulatory, and accounting systems are relatively transparent and consistent with international norms. Post is not aware of any government requirements for companies’ environmental, social, and governance (ESG) disclosure to facilitate investments.

Draft bills, proposed legislation, and draft regulations are normally not available for public comment and are not required to be, although there are consultations on such documents throughout the government. Depending on the topic, bills are customarily drafted within the relevant ministry with stakeholder or public consultation and then presented to the parliament for debate. Comments on draft legislation and regulations may also be solicited through public meetings or targeted outreach to stakeholder groups. Such comments are also not required to be made public and generally are not. There is no formal process of appeal or reconsideration of published regulations. Approved legislation and regulations are publicly available and published in the Government Gazette, the official journal of the government of Namibia. The Government Gazette is digitalized and public.

Public finances are generally transparent, with the annual budget and mid-term budget reviews published on the Ministry of Finance’s website and in the Government Gazette. The Ministry of Finance has begun in the past few years holding consultations with interest groups during the budget preparation process. The Bank of Namibia publishes the Government of Namibia’s debt position – including explicit and contingent liabilities – in its annual reports and quarterly bulletins.

### International Regulatory Considerations

The national coordinating bureau for standards is the Namibian Standards Institution. Namibia is also a member of the International Organization for Standardization. As a member of SACU and SADC, Namibia’s national regulations conform to both regional agreements. Namibia is a member of the World Trade Organization (WTO) and notifies the Committee on Technical Barriers to Trade on draft technical regulations.

### Legal System and Judicial Independence

The Namibian court system is independent and is widely perceived to be free from government interference. Namibia’s legal system, based on Roman Dutch law, is similar to that of South Africa. The system provides effective means to enforce property and contractual rights, but the speed of justice is generally very slow due to a backlog of cases across the judicial spectrum. Regulation and enforcement actions are appealable. The Minister of Justice may introduce legislation in Parliament in 2022 that would permit plea bargains to expedite cases and reduce backlog to advance rule of law in Namibia.

### Laws and Regulations on Foreign Direct Investment

The Foreign Investment Act (FIA) provides for liberal foreign investment conditions and equal treatment of foreign and local investors. With limited exceptions, all sectors of the economy are open to foreign investment. There is no local participation requirement in the FIA, but the Namibian government is increasingly emphasizing the need for investors to partner with Namibian-owned companies and/or to have a majority of local employees in order to operate in the country.

The FIA reiterates the protection of investment and property provided for in the Namibian Constitution. It also provides for equal treatment of foreign investors and Namibian firms, including the possibility of fair compensation in the event of expropriation, international arbitration of disputes between investors and the government, the right to remit profits, and access to foreign exchange.

The Business and Intellectual Property Agency (BIPA) acts as a one-stop-shop for business registrations and provides information on relevant laws, rules, procedures, and reporting requirement for investors. More information is available online at: http://www.bipa.na/.

In August 2016, Namibia promulgated and gazetted the Namibia Investment Promotion Act (NIPA). However, the Minister of Industrialization and Trade pulled back the legislation in November 2021 due to substantive legal concerns raised by the private sector and the NIPBD. The revised Namibia Investment Promotion Act (NIPA) will replace the FIA once revisions are complete and approved by Parliament. The NIPA provides for transparent admission procedures for investors, the reservation of certain categories of business and sectors, and the establishment of an integrated client service facility or one-stop-shop for investors within the NIPDB.

### Competition and Antitrust Laws

Established in 2009, the Namibia Competition Commission (NaCC) is the principal institution that promotes and safeguards fair competition in Namibia. The Commission is tasked with: providing consumers with competitive prices and product choices; promoting employment and advancing the social economic welfare of Namibians; expanding opportunities for Namibian participation in world markets while recognizing the role of foreign competition in Namibia; ensuring that small businesses have an equitable opportunity to participate in the Namibian economy; and promoting a greater spread of ownership, particularly increasing ownership stakes of historically disadvantaged persons. The NaCC has the mandate to review any potential mergers and acquisitions that might limit the competitive landscape or adversely impact the Namibian economy. For example, in August 2020, the NaCC blocked the sale of Schwenk Namibia’s stake in Ohorongo Cement to West China Cement Ltd. over fears the deal could lead to anti-competitive behavior in the local cement market.  In the ruling, the competition watchdog said that, if the USD 870 million deal was allowed to proceed, it would stifle competition and lead to possible collusion and price-fixing.  The Minister of Industrialization and Trade is the final arbiter on merger decisions and may accept or reject a NaCC decision. Any investor can file an appeal with the ministry, though no formal process for doing so has been established.

### Expropriation and Compensation

The Namibian Constitution enshrines the right to private property but allows the state to expropriate property in the public interest subject to the payment of just compensation. The Agricultural (Commercial) Land Reform Act 6 of 1995 (ACLRA) is the primary legal mechanism allowing for expropriation, but the government has adhered to a “willing seller/willing buyer” policy as part of land reform programs. In 2004, the government announced it would proceed with land expropriations after much criticism about the slow pace of land reform. To date, the government has only expropriated farms from a small number of owners, and in each instance ultimately either compensated the owner or returned the land. In March 2008, Namibia’s High Court ruled against the government in *Gunter**Kessl**v. Ministry of Lands and Resettlement* – the sole instance in which expropriation was legally challenged – and in doing so established a strong legal precedent protecting individual land rights. Non-binding resolutions adopted at the Second National Land Conference in 2018 resolved to abolish the “willing seller/willing buyer” policy and bar foreign ownership of agricultural land; however, no legislation formalizing these resolutions has been proposed. The Namibian Constitution makes pragmatic provision for different types of economic activity and a “mixed economy” (Article 98), accepts the importance of foreign investment (Article 99), and enshrines the principle that the ownership of natural resources is vested in the Namibian state (Article 100) and the right to property (Article 16). Section 11 of the FIA reiterates the commitment to market compensation in the case of expropriation, which is also codified in Article 16 of the Constitution. Holders of a Certificate of Status Investment must be compensated in foreign currency and can opt for international arbitration if any disputes arise.

### Dispute Settlement

#### ICSID Convention and New York Convention

Namibia signed but has not ratified the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID). Namibia has also neither signed nor ratified the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards. The ICSID and New York Convention are therefore not applicable.

#### Investor-State Dispute Settlement

The FIA allows for the settlement of disputes by international arbitration for investors that have obtained a Certificate of Status Investment (CSI) that includes a provision for international arbitration. The FIA stipulates that arbitration “shall be in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law in force at the time when the Certificate was issued” unless the CSI stipulated another form of dispute resolution. There have not been any investment disputes involving a U.S. person in the last 10 years.

#### International Commercial Arbitration and Foreign Courts

As the “one-stop-shop” for investors, the Namibia Investment Promotion and Development Board (NIPDB) is the body that first learns of an investment dispute between a foreign investor and a domestic enterprise. The NIPDB, established in 2020, has not yet received a report of an investment dispute involving U.S. entities. Investment disputes can be handled by the courts.

There is no domestic arbitration body in Namibia. Investors without a CSI that encounter a dispute have to address their dispute in the Namibian courts or in the court system which has jurisdiction according to the investor’s contract. The Namibian court system is independent and is widely perceived to be free from government interference, including when state-owned enterprises (SOEs) are involved in investment disputes.

### Bankruptcy Regulations

The Companies Act of 1973, amended in 2004, governs company and corporate liquidations while the Insolvency Act 12 of 1936, as amended by the Insolvency Amendment Act of 2005, governs insolvent individuals and their estates. The Insolvency Act details sequestration procedures and the rights of creditors. Through the law, all debtors (whether foreign or domestic) may file for both liquidation and reorganization, and a creditor may file for both liquidation and reorganization. However, as reorganization (judicial management) is rarely successful in Namibia, the most likely insolvency procedure is liquidation. International credit monitoring agency TransUnion is a licensed credit bureau in Namibia.

							4. Industrial Policies					

### Investment Incentives

Incentives are mainly aimed at stimulating manufacturing, attracting foreign investment to Namibia, and promoting exports. To take advantage of Namibia’s incentives, companies must be registered with MIT and the Ministry of Finance. Tax and non-tax incentives are accessible to both existing and new manufacturers. MIT has produced a brochure on Special Incentives for Manufacturers and Exporters that is available from the Namibia Investment Promotion and Development Board (NIPDB). Post is not aware of any special incentives for businesses owned by underrepresented investors, such as women.

Namibia aims to become a renewable energy hub of Africa. The country therefore offers favorable import incentives on renewable energy technologies, exempting solar panels, wind turbines, and batteries from import duties.

The Namibian Government aims to stimulate economic growth and employment and to establish Namibia as a gateway location to the Southern African region. To this end, the government has introduced numerous incentives that are largely concentrated on stimulating manufacturing in Namibia and promoting exports into the region and to the rest of the world. General tax regulations that are indicative of the government’s commitment are:

- Non–resident Shareholders’ Tax is only 10%;
- Dividends accruing to Namibian companies or resident shareholders are tax-exempt;
- Machinery and equipment can be fully written off over a period of three years;
- Buildings of non-manufacturing operations can be written off: 20% in the first year and the balance at 4% over the ensuing 20 years;
- Import or purchase of manufacturing machinery and equipment is exempted from Value Added Tax (VAT); and,
- Through trade agreements, preferential market access to the European Union (EU), United States, and other markets for manufacturers is provided.

The government does sometimes issue guarantees, but reluctantly. Joint financing for foreign direct investment is occasionally implemented through the Namibia Industrial Development Agency (NIDA) or another, sector-relevant state-owned enterprise.

### Foreign Trade Zones/Free Ports/Trade Facilitation

In March 2021, the EU removed Namibia from its list of tax havens after Namibia successfully implemented reforms to bring its tax systems up to the EU’s required standards.  The EU had identified the preferential treatment and tax incentives to manufacturers and export processing zones (EPZ) as harmful tax regimes and allowed Namibia until December 2021 to adapt existing legislation. In June 2020, the Namibian government repealed the EPZ that had offered tax incentives to companies located in Namibia to manufacture and export products. Namibia is in the process of creating an improved Special Economic Zone (SEZ) policy which aims to increase responsiveness to investors’ needs and address the weaknesses of the EPZ regime. This process is ongoing, and the government aims to complete it in 2022.

### Performance and Data Localization Requirements

The government actively encourages partnerships with historically disadvantaged Namibians. Namibia’s Affirmative Action Act of 1998 strives to create equal employment opportunities, improve conditions for the historically disadvantaged, and eliminate discrimination. The Equity Commission requires all firms to develop an affirmative action plan for management positions and to report annually on its implementation. The Equity Commission also facilitates training programs, provides technical and other assistance, and offers expert advice, information, and guidance on implementing affirmative action in the workplace.

In certain industries, the government has employed specific techniques to increase Namibian participation. In the fishing sector, for example, companies pay lower quota fees if they operate Namibian-flagged vessels based in Namibia with crews that are predominantly Namibian.

Economic empowerment legislation for previously disadvantaged groups, called the New Equitable Economic Empowerment Bill (NEEEB) is under consideration in the legislature. The bill is being reviewed and could be reintroduced in Parliament during 2022. The bill is likely to contain provisions relating to ownership, management, value addition, human resource capacity building, job creation, and corporate social responsibility that aim to help previously disadvantaged Namibians. While not yet legally bound to do so, many companies in Namibia are already implementing aspects of NEEEB.

The Namibian government does not have “forced localization” requirements for data storage. Domestic content is encouraged. State-owned enterprises are including local ownership/ participation.

							5. Protection of Property Rights					

### Real Property

The Namibian Constitution guarantees all persons the right to acquire, own, and dispose of all forms of property throughout Namibia, but also allows Parliament to make laws concerning expropriation of property (*see Expropriation and Compensation Section*) and to regulate the right of foreign nationals to own or buy property in Namibia. There are no restrictions on the establishment of private businesses, size of investment, sources of funds, marketing of products, source of technology, or training in Namibia. All deeds of sales are registered with the Deeds Office. Property is usually purchased through real estate agents and most banks provide credit through mortgages. The Namibian Constitution prohibits expropriation without just compensation (Article 16).

### Intellectual Property Rights

Namibia is a party to the World Intellectual Property Organization (WIPO) Convention, the Berne Convention for the Protection of Literary and Artistic Works, and the Paris Convention for the Protection of Industrial Property. Namibia is also a party to the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks and the Patent Cooperation Treaty (PCT). Namibia is a signatory to the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT).

The responsibility for intellectual property rights (IPR) protection is divided among three government ministries. The MIT oversees industrial property and is responsible for the registration of companies, private corporations, patents, trademarks, and designs through its Business and Intellectual Property Authority (BIPA). The Ministry of Information and Communication Technology (MICT) manages copyright protection, while the Ministry of Environment, Forestry, and Tourism (MEFT) protects indigenous plant varieties and any associated traditional knowledge of these plants.

Two copyright organizations, the Namibian Society of Composers and Authors of Music (NASCAM) and the Namibian Reproduction Rights Organization (NAMRRO), are the driving forces behind the government’s anti-piracy campaigns. NASCAM administers IPR for authors, composers, and publishers of music. NAMRRO protects all other IPR, including literary, artistic, broadcasting, satellite, traditional knowledge, and folklore.

Namibia has been in the process of finalizing its intellectual property legislation for several years, which BIPA eventually will administer.

Namibia is not included in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/.

							6. Financial Sector					

### Capital Markets and Portfolio Investment

There is a free flow of financial resources within Namibia and throughout the Common Monetary Area (CMA) countries of the SACU, which include Namibia, Botswana, eSwatini, South Africa, and Lesotho. Capital flows with the rest of the world are relatively free, subject to the South African currency exchange rate. The Namibia Financial Institutions Supervisory Authority (NAMFISA) registers portfolio managers and supervises the actions of the Namibian Stock Exchange (NSX) and other non-banking financial institutions.

Although the NSX is the second-largest stock exchange in Africa, this ranking is largely because many South African firms listed on the Johannesburg exchange are also listed (dual-listed) on the NSX. By law, Namibia’s Government Institution Pension Fund (GIPF) and other Namibian funds are required to allocate a certain percentage of their holdings to Namibian investments. Namibia has a world-class banking system that offers all the services needed by a large company. Foreign investors are able to get credit on local market terms.

There are no laws or practices by private firms in Namibia to prohibit foreign investment, participation, or control; nor are there any laws or practices by private firms or government precluding foreign participation in industry standards-setting consortia.

### Money and Banking System

Namibia’s central bank, the Bank of Namibia (BON), regulates the banking sector. Namibia has a highly sophisticated and developed commercial banking sector that is comparable with the best in Africa. There are eight commercial banks: Standard Bank, Nedbank Namibia, Bank Windhoek, First National Bank (FNB) Namibia, Trustco Bank, Letshego Bank Limited, Banco BIC, and Banco Atlantico. Bank Windhoek and Trustco Bank are the only locally-owned banks; Trustco Bank specializes in micro-finance. Standard Bank, Nedbank, and FNB are South African subsidiaries; Banco BIC and Banco Atlantico are Angolan. A significant proportion of bank loans come in the form of bonds or mortgages to individuals. There is little or no investment banking activity.

The Development Bank of Namibia (DBN) and Agribank are Namibian government-owned banks with a mandate for development project financing. Agribank’s mandate is specifically to serve the agriculture sector.

While there are no restrictions on foreigners’ ability to open bank accounts, a non-resident must open a “non-resident” account at a Namibian commercial bank to facilitate loan repayments. This account would normally be funded from abroad or from income from rentals received on the property purchased, subject to the bank holding the account being provided with a copy of any rental contract. Non-residents who are in possession of a valid Namibian work permit/permanent residency are considered to be residents for the duration of their work permit and are therefore not subject to borrowing restrictions placed on non-residents without the necessary permits.

The BON does not recognize cryptocurrencies, such as Bitcoin, as legal tender in Namibia. The BON is reluctant to allow the implementation of blockchain technologies in banking transactions.

### Foreign Exchange and Remittances

#### Foreign Exchange

The Namibian dollar is pegged at parity to the South African rand, and rand are accepted as legal tender in Namibia. The FIA offers investors meeting certain eligibility criteria the opportunity to obtain a Certificate of Status Investment (CSI). A “status investor” is entitled to:

- Preferential access to foreign exchange to repay foreign debt, pay royalties and similar charges, and remit branch profits and dividends;
- Preferential access to foreign currency in order to repatriate proceeds from the sale of an enterprise to a Namibian resident;
- Exemption from regulations which might restrict certain business or categories of business to Namibian participation;
- Right to international arbitration in the event of a dispute with the government; and
- Payment of just compensation without undue delay and in freely convertible currency in the event of expropriation.

#### Remittance Policies

According to World Bank Development Indicators, remittances to Namibia have been consistently less than 0.15 percent of GDP for at least the last decade. The majority of remittances are processed through commercial banks. There have been no plans to change investment remittance policies in recent times.

### Sovereign Wealth Funds

Namibia does not have a Sovereign Wealth Fund (SWF), but the government has publicly stated its intention to create one. The Government Institution Pension Fund (GIPF) provides retirement and benefits for employees in the service of the Namibian government as well as institutions established by an act of the Namibian Parliament.

							7. State-Owned Enterprises					

While Namibian companies are generally open to foreign investment, government-owned enterprises have generally been closed to all investors (Namibian and foreign), with the exception of joint ventures discussed below. More than 90 state-owned enterprises (SOEs, also known as parastatals) include a wide variety of commercial companies, financial institutions, regulatory bodies, educational institutions, boards, and agencies. Generally, employment at SOEs is highly sought-after because their remuneration packages are not bound by public service constraints. Parastatals provide most essential services, such as telecommunications, transport, water, and electricity. A list of SOEs can be found on the Ministry of Public Enterprises’ website: www.mpe.gov.na. The following are the most prominent SOEs:

- Namibia Airports Company (airport management company)
- Namibia Institute of Pathology (medical laboratories)
- Namibia Wildlife Resorts (tourism)
- Namport (maritime port authority)
- Nampost (postal and courier services)
- Namwater (water sanitation and provisioning)
- Roads Contractor Company
- Telecom Namibia (primarily fixed-line)
- TransNamib (rail company)
- NamPower (electricity generation and transmission)
- Namcor (national petroleum company)
- Epangelo (mining)

In 2021, the government liquidated the state-owned airline, Air Namibia, which had become a financial burden. When the Minister of Finance tabled the budget in March 2021, he announced that the Namibian government will reduce its stake in state-owned enterprises as a way of raising capital, unburdening the government from the budgetary drain of perpetual SOE-bailouts, and giving room for the private sector to play a more prominent role in the economy.  The government is looking to reduce its stake or completely divest in certain SOEs.

The government owns numerous other enterprises, from media ventures to a fishing company. Parastatals own assets worth approximately 40 percent of GDP and most receive subsidies from the government. Most SOEs are perennially unprofitable and have only managed to stay solvent with government subsidies. In industries where private companies compete with SOEs (e.g., tourism and fishing), SOEs are sometimes perceived to receive favorable concessions from the government. Foreign investors have participated in joint ventures with the government in a number of sectors, including mobile telecommunications and mining.

In 2015, the Namibian President created a new Ministry of Public Enterprises intended to improve the management and performance of SOEs. Legislation to shift oversight of commercial SOEs from line ministries to the Ministry of Public Enterprises was passed by Parliament in 2019. However, the Ministry of Public Enterprises reached the end of its mandate in 2022 and will be absorbed into the Ministry of Finance.

### Privatization Program

Namibia does not have a privatization program, but the government has taken steps towards privatization of certain SOEs. In 2021, the government sold its shares in Namibia’s biggest telecommunications company, Mobile Telecommunications Company (MTC), and purportedly used the proceeds to reduce the government’s debt.

							8. Responsible Business Conduct					

Most large firms, including SOEs, have well defined (and publicized) social responsibility programs that provide assistance in areas such as education, health, environmental management, sports, and small and mid-sized enterprise (SME) development. Many firms include Black Economic Empowerment (BEE) programs within their larger Corporate Social Responsibility (CSR) programs. Firms operating in the mining sector – Namibia’s most lucrative industry – generally have visible CSR programs that focus on education, community resource management, environmental sustainability, health, and BEE. Many Namibian firms have HIV/AIDS workplace programs to educate their employees about how to prevent contracting and spreading the virus/disease. Some firms also provide anti-retroviral treatment programs beyond what may be covered through government and private insurance systems.

Namibia’s mining sector is considered a leader in the region for its sound mining policy and responsible business conduct. Namibia ranked as the best jurisdiction in Africa on its mining policy in a 2019 Fraser Institute survey. The Namibian Chamber of Mines (https://chamberofmines.org.na) is an independent association of mining businesses that monitors and encourages responsible business practices and corporate social responsibility from its members and the mining industry at large. Namibia is also a member of the U.S. Department of State’s Energy Resource Governance Initiative (ERGI), which seeks to promote sound mining governance and resilient energy mineral supply chains. Namibia is not a member of the Extractive Industries Transparency Initiative (EITI).

### Additional Resources

Department of State

- Country Reports on Human Rights Practices ;
- Trafficking in Persons Report ;
- Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities ;
- U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises ; and;
- Xinjiang Supply Chain Business Advisory 

Department of the Treasury

- OFAC Recent Actions

Department of Labor

- Findings on the Worst Forms of Child Labor Report ;
- List of Goods Produced by Child Labor or Forced Labor ;
- Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World  and;
- Comply Chain .

### Climate Issues

Namibia is particularly vulnerable to the impacts of climate change. Already one of the most arid countries on the planet, Namibia has been experiencing extensive drought in the past decade. Namibia’s Harambee Prosperity Plan II (2021-2025) and Fifth National Development Plan (2017-2022) as well as its 2021 updated Nationally Determined Contribution (NDC) are the guiding documents for Namibia’s climate adaptation strategy. In the near-term Namibia’s adaptation activities are focused on prevention and repair of infrastructure and systems. Namibia is in the process of creating an overarching National Adaptation Plan, which will supply further detail for national adaptation priorities and implementation of long-term strategies.

Namibia has committed to reducing its overall greenhouse gas (GHG) emissions by 92 percent by 2030 from the business-as-usual baseline level. Namibia aims to achieve this goal mainly through reducing deforestation and restoring grasslands and forest, with additional contributions coming from updating old industrial equipment and using cleaner energy fuels. Namibia has declared it aims to be the first African country to achieve net-zero emissions by 2050. Namibia does not yet have official regulatory or other government policy incentives to help it achieve its climate policy outcomes.

With the second highest solar radiation in the world, plentiful wind resources, and ample land, Namibia is well placed to develop a renewable energy industry. Namibia is looking to use its renewable resources to transition from its current dependency on coal generated electricity from South Africa to becoming a net energy renewable energy exporter to the region. Namibia also has bold plans to become a world green hydrogen leader and in 2021 awarded its first international tender for development of a green hydrogen plant that could begin production for international export in 2026. Namibia plans to form partnerships with private sector international firms to continue rolling out its green hydrogen industry over the next several years. The government has also created a website devoted to its green hydrogen plans: gh2namibia.com

							9. Corruption					

The Anti-Corruption Act of 2003 created an Anti-Corruption Commission (ACC), which began operations in 2006. The ACC attempts to complement civil society’s anti-corruption programs and support existing institutions such as the Ombudsman’s Office and the Office of the Attorney

General. Anti-corruption legislation is in place to combat public corruption, but often is not well-implemented due to budgetary constraints. In a nationwide survey commissioned by the ACC and released in 2016, corruption was listed at the third-most important development challenge facing Namibia (6 percent, after unemployment at 37 percent and poverty at 30 percent). 78 percent of survey respondents rated corruption as “very high” in Namibia. The highest result comes from those in rural areas. Namibia’s 2021 rating by Transparency International’s *Corruption Pe**r**c**e**ption**s****I**ndex* worsened to 58 out of 180 from a score of 57 in 2020. Afrobarometer has also reported a downward trend regarding perception of corruption in Namibia over the past decade.

In 2019, Namibia was embroiled in a fishing industry corruption scandal in which government ministers and business leaders were charged and imprisoned for allegedly co-opting the national fishing quota system for personal gain. The scandal allegedly cost Namibia billions of U.S. dollars and has tarnished the reputation of the ruling political party. The accused are in prison awaiting trial. The scandal has resulted in Namibia and its ACC taking a closer look at other industries susceptible to corruption, but many Namibians criticize the government for not doing enough to combat corruption

Namibia has signed and ratified the UN Convention against Corruption and the African Union’s African Convention on Preventing and Combating Corruption. Namibia has also signed the Southern African Development Community’s Protocol against Corruption.

### Resources to Report Corruption

Paulus NoaDirectorNamibia Anti-Corruption CommissionCorner of Montblanc & Groot Tiras Street, Windhoek+264-61-370-600anticorruption@accnamibia.org

Contact at a “watchdog” organization:Graham Hopwood

DirectorNamibia Institute for Public Policy Research (IPPR)70-72 Frans Indongo Street, Windhoek+264-61-240-514info@ippr.org.na

National anti-corruption network **Integrity Namibia operated by IPPRhosts an onlineWhistleblower reporting portal: info@integritynamibia.org

							10. Political and Security Environment					

Namibia has been a stable multiparty and multiracial democracy since becoming independent in 1990. The protection of human rights is enshrined in the Namibian Constitution, and the government generally respects those rights. Political violence is rare and damage to commercial projects and/or installations as a result of political violence is unlikely. The State Department’s Country Report on Human Rights for Namibia provides additional information.

							11. Labor Policies and Practices					

Namibian law allows for the formation of independent trade unions to protect workers’ rights and to promote sound labor relations and fair employment practices. The law provides for the right to form and join independent unions, conduct legal strikes, and bargain collectively on specific issues; however, the law prohibits workers in certain sectors, such as the police, military, and correctional facilities, from joining unions. Except for workers in services designated as essential, such as public health and safety, workers may strike once mandatory conciliation procedures are exhausted and 48 hours’ notice is given to the employer and labor commissioner. Workers may take strike actions only in disputes involving specific worker interests, such as pay raises.

Namibia has ratified all of the International Labor Organization’s fundamental conventions. Businesses operating within export processing zones are required to adhere to the Labor Act. The 2007 Labor Act contained a provision that prohibited the hiring of temporary or contract workers (“labor hire”), but the provision was ruled unconstitutional by the Supreme Court. The Labor Amendment Act of 2012 introduced strict regulations with respect to the use of temporary workers, according to which temporary workers must generally receive equal compensation and benefits as non-temporary workers.

Child labor in Namibia occurs in certain sectors, such as domestic and agricultural work, and its occurrence and prevalence are difficult to verify. Although Namibia has ratified all key international conventions concerning child labor, there continue to be gaps in Namibia’s domestic legal framework.

There is a shortage of specialized skilled labor in Namibia. Employers often cite labor productivity and the shortage of skilled labor as the biggest obstacles to business growth. The most recent Global Competitiveness Report (2019) ranked Namibia 94th out of 141 economies. An inadequately educated workforce, access to financing, and low innovation capability are listed in the report as the most problematic factors for doing business.

The government offers manufacturing companies special tax deductions of up to 25 percent if they provide technical training to employees. The government will also reimburse companies for costs directly related to employee training under approved conditions.

As of April 1, 2014, the Namibian government implemented a Vocational Education and Training (VET) levy to facilitate and encourage vocational education and training. The levy, which is payable to the Namibia Training Authority (NTA), is imposed on every employer with an annual payroll of at least NAD 1,000,000 (approximately USD 54,000), at the rate of one percent of the employer’s total annual payroll. The NTA will collect and administer the levy and will use the funds to provide financial and technical assistance to employers, vocational training providers, employees, students, and other bodies to promote vocational education and training. In addition, companies can get a rebate from NTA of up to 50 percent of training costs for their employees.

The role of the informal economy in Namibia cannot be underestimated, as it provides integral support to more formal business activities. According to the most recent Namibian Labour Force Survey (2018), the informal economy employs more than half of employed Namibians. Informal economic activity includes small-scale entrepreneurs, traders, and service providers such as cleaners, cooks, and laborers. Informal economic activity is the primary employment means of women in rural areas. Namibian economic analysts posit that informal sector activities contribute to around 70 percent of GDP in any given year.

							12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs					

The United States has had an Investment Incentive Agreement with Namibia since 1990. The Development Finance Corporation (DFC) is the U.S. Government entity that provides political risk insurance and credit facilities to qualified U.S. investors in Namibia. Namibia is also a member of the World Bank’s Multilateral Investment Guarantee Agency (MIGA). DFC has a current investment in the table grape industry and is considering an investment in the mining sector.

							13. Foreign Direct Investment and Foreign Portfolio Investment Statistics					

*** Source for Host Country Data: Namibia Statistics Agency and Bank of Namibia**

A glaring omission from the International Monetary Foundation’s (IMF) report on inward direct investment to Namibia is China’s contribution, which the Bank of Namibia reports as 42.4% of the total in 2021 and 39.5% in 2020. China is included in the Bank of Namibia’s report but is omitted from the IMF reports. The Embassy assesses that China’s investment in Namibia is increasing not decreasing. Notorious tax haven British Virgin Islands is a notable top destination for inward direct investment sources into Namibia. There are some other discrepancies between the information reported in the IMF report and the Bank of Namibia’s report, such as the inclusion of Botswana in 2020.

Source: IMF Coordinated Direct Investment Survey (CDIS) https://data.imf.org/?sk=40313609-F037-48C1-84B1-E1F1CE54D6D5&sId=1482331048410and the Bank of Namibia’s 2021 Annual Report.

							14. Contacts for More Information:					

Tabitha SnowbargerEconomic and Commercial Officer14 Lossen Street, Windhoek, Namibia+264-61-295-8500SnowbargerTJ@state.govEcon_Comm_Windhoek@state.gov

Buti HambiraEconomic-Commercial Specialist14 Lossen Street, Windhoek, Namibia+264-61-295-8500HambiraBT@state.gov

## View report by:

### On This Page

                    -  Executive Summary 
                    -  1. Openness To, and Restrictions Upon, Foreign Investment                        -  Policies Towards Foreign Direct Investment 
                      -  Limits on Foreign Control and Right to Private Ownership and Establishment 
                      -  Other Investment Policy Reviews 
                      -  Business Facilitation 
                      -  Outward Investment 
                    -  2. Bilateral Investment and Taxation Treaties   
                    -  3. Legal Regime                        -  Transparency of the Regulatory System 
                      -  International Regulatory Considerations 
                      -  Legal System and Judicial Independence 
                      -  Laws and Regulations on Foreign Direct Investment 
                      -  Competition and Antitrust Laws 
                      -  Expropriation and Compensation 
                      -  Dispute Settlement                          -  ICSID Convention and New York Convention 
                        -  Investor-State Dispute Settlement 
                        -  International Commercial Arbitration and Foreign Courts 
                      -  Bankruptcy Regulations 
                    -  4. Industrial Policies                        -  Investment Incentives 
                      -  Foreign Trade Zones/Free Ports/Trade Facilitation 
                      -  Performance and Data Localization Requirements 
                    -  5. Protection of Property Rights                        -  Real Property 
                      -  Intellectual Property Rights 
                    -  6. Financial Sector                        -  Capital Markets and Portfolio Investment 
                      -  Money and Banking System 
                      -  Foreign Exchange and Remittances                          -  Foreign Exchange 
                        -  Remittance Policies 
                      -  Sovereign Wealth Funds 
                    -  7. State-Owned Enterprises                        -  Privatization Program 
                    -  8. Responsible Business Conduct                        -  Additional Resources 
                      -  Climate Issues 
                    -  9. Corruption                        -  Resources to Report Corruption 
                    -  10. Political and Security Environment   
                    -  11. Labor Policies and Practices   
                    -  12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs   
                    -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                    -  14. Contacts for More Information:   

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