The Bank of Namibia and the Ministry of Finance will officially launch Namibia’s Sovereign Wealth Fund on the 12th May 2022.
The Welwitschia Fund is set to become one of Africa’s newest sovereign wealth funds, and will be administered by The Bank of Namibia.
President Hage Geingob in April, while delivering his 8th State of the Nation Address (SONA) said the fund will have an initial capital injection of N$300 million.
Several countries across the world are establishing Sovereign Wealth Funds – a state-owned investment fund composed of money generated by the government, often derived from a country’s surplus reserves invested for the benefit of a country’s economy and its citizens. According to Global SWF, African Sovereign Wealth Funds are worth an estimated US$16.4 billion.
Namibia’s Sovereign Wealth Fund, structured into short and a long-term, will have a balanced mandate where 70% of the assets bought are risky assets such as equities while the rest are fixed income assets, real estate and private equity.
About 2.5% of the intergenerational fund will be invested in infrastructure projects with socio-economic benefits for future generations.
Government aims to set up the Fund with financing from savings, proceeds from the green renewable sector, mining royalties, fishing quotas, divestiture of state-owned enterprises as well as Southern African Customs Union receipts.
Hyphen Hydrogen Energy, which has won two bids to construct Namibia’s inaugural green hydrogen projects, has also committed 2.5% of the annual revenue to be generated from the project to go to the Sovereign Wealth Fund.
