By Josef Kefas Sheehama
At a media event held on September 28, 2022, in the Karas region, the Namibia Statistics Agency (NSA) announced the GDP figures for the second quarter of 2022.
During the second quarter of 2022, the Gross Domestic Product (GDP) rose by 5.6%. Manufacturing, which contributed 12.1% of the second quarter’s GDP growth, followed by wholesale and retail trade, which contributed 10.2%, and agriculture, which contributed 10%. The Namibian economy expanded by N$5.4 billion from the N$43.2 billion reported in the preceding quarter of 2021, according to the NSA. The mining and quarrying sector, which contributed 2.6% of the GDP growth during the quarter under review, and financial services, which contributed 1.1%, were the two main drivers of the 5.6% GDP increase. This indicates that in the second quarter of 2022, the domestic economy grew to N$48.6 billion. The risk of sector-specific tightening measures or accommodation removal is increasing as the economy continues to improve. Therefore, we must invest in them, impose heavy taxes and levies on imported goods, develop policies that would stimulate increased production, and update our infrastructure to defend and expand domestic industrial sectors.
After a protracted period of political challenges and responses to the apartheid government on the side of the international community, Namibia was finally able to reintegrate its economy into global trade in 1995. The institutional structure of the economy has not changed, and successive governments in Namibia have faced significant economic policy issues in adjusting the trade policy regime to the new agenda and structures. Industrialization, which falls under the industrial sector, is mostly regarded as a crucial tool for accelerating economic growth and development. Manufacturing has generally been described and accepted as a catalyst for economic growth and development around the world. Namibia needs to implement reforms that will open up and attract investments into key subsectors within the manufacturing and agro-processing sector, thus, creating opportunities along value chains. Macroeconomic stability, good governance and provision of infrastructure are supporting factors that will improve productivity and output across sectors.
Furthermore, inclusive growth embraces the need for a strong industry-led economy. For instance, industrial sectors such as manufacturing and agro-processing should be the engine of economic transformation. The rapid expansion of the manufacturing and agro-processing sectors will lead to massive job creation, diversification of export earnings and reduction in the importation of foods and other items that can easily be produced locally. The manufacturing sector can potentially play a key role in the overall economic development agenda as well as initiatives geared at employment creation and effective reduction of poverty. We need to understand that the manufacturing sector is a big employer of both skilled and unskilled labour. If the manufacturing is at full capacity, the manufacturing sector also contributes significantly to GDP as per the NSA release. This means that we need to invest in manufacturing. It is important to note that the manufacturing sector also plays an important role by providing a key link between producers of raw materials and consumers of the manufactured products, thereby situating the sector to play a decisive role in determining the extent to which an economy can be self-sustained. Therefore, the manufacturing sector can also be regarded as the avenue through which transform itself from being a producer and exporter of primary agriculture. It also calls for measures to make it easier to import scarce skills by streamlining the work permit and visa system. This will be accompanied by a skills transfer programme to ensure that local skills development is enhanced. Government calls for greater focus by Namibian businesses on opportunities in fast-growing economies.
Moreover, we cannot oversight agricultural sectors. In one accord, as agriculture becomes more productive, excess labour moves from rural farm jobs to urban manufacturing jobs. While the result of this stage is a decreased share of agriculture in GDP and the labour force, the process of agricultural modernization is critical for economic transformation and achieving food security. Engaging youth in agriculture has been a prominent topic and has risen to the development agenda, as there is a growing concern worldwide that young people have become disenchanted with agriculture. Despite the decline in interest in agriculture as a career, there are still young farmers working all over the world. To encourage others to join the sector they must be offered a voice, and take note of what they have to say. Particularly this includes giving young farmers at the policy level a chance to offer their opinion and experiences. In this way, they can show other young people that farming can be a rewarding career as well as highlight the important role of agriculture on a global scale. Agriculture is mainly key for development at the local level or regional level. As we know that most people around the world often depend on agriculture production and agriculture production feeds the world with youth farmers workers so we’ll need to set up a potential program for youth farming to guarantee the future.
Namibia’s industrial ambition is articulated in Vision 2030, which stipulates that the country should be an industrialized nation with a high income by the year 2030. Namibia to achieve V2030, a robotic cognition factors that hinder greater participation by new firms in the economy, such as the existing regulations and policies that support incumbents or are ineffective in assisting rivals and new firms; competition legislation that favours large firms and incumbents; and access to finance challenges. Change in economic relations must be the creation of opportunities for all Namibians to live productive, prosperous, and dignified lives. Current trade and industrial policies have made some progress towards attaining economic and structural transformation and contributing to inclusive growth. Namibia’s industrial policy is on the right track, but some important adjustments could significantly improve its effectiveness. There is a need to first evaluate the land reform and focus on the return of production or increase of production on the farms before embarking on further indigenization in other sectors. The big problem that the government faces is unemployment. Therefore, industrial and trade policy interventions cannot effectively achieve their desired outcomes if they are not complemented by an overall supportive business environment. For this reason, Namibia needs to shift its focus toward increasingly attractive regional growth opportunities which hold significant potential to increase intra-regional exports and foster growth and economic development in the region.
In conclusion, the aim is to review the manufacturing sector by identifying key structural bottlenecks, highlighting their implications, and oring recent government interventions and proffer workable policy interventions. Namibia needs such investment to clear the backlog of unemployed. This, therefore, shows that although the government is expected to play a role in boosting the sector, the private sector has to play a larger part by remaining conscious of the market needs and responding to them through innovation and strategizing. This calls for the need to embrace new technologies as required by the dynamic manufacturing environment.
Therefore, neglect of the agricultural sector and a call to revive the economy through huge concentration on agriculture is motivated to turn the economy into a large production base. In addition to this, such an effort would stimulate the performance of other notable sectors like manufacturing and solid mineral.
This would be an avenue to integrate the manufacturing sector as it would equally be empowered through the provision of needed raw materials which in long run foster forward and backward linkages.
