Namibian President Hage Geingob is confident about the future economic prospects of the country following the discovery of oil by Qatar Energy, Shell, and Total Energies in the Orange Basin, offshore Namibia near Luderitz.
“The discoveries of potential giant oil reserves…are set to positively transform the economic landscape of our country and the well-being of our people,” said Geingob.
He added that the discoveries, which could bring increased foreign and domestic direct investment into the gas and oil sectors, as well as the broader economy, in the short and medium term, will help accelerate the country’s economic recovery.
Geingob stated that the Shell and Total Energies discoveries could generate annual taxes and royalties of between N$60-N$95 billion, with the potential to create 3,600 jobs at the peak of production. “These discoveries are ranked among the top 20 globally in the last decade,” he said.
According to international experts (Wood Mackenzie), Namibia stands to receive N$500 billion in Foreign Direct Investment in this regard.
“It is estimated that the two oil projects will create over 3,600 jobs at the peak of production and double Namibia’s Gross Domestic Product by 2040 to around N$636 billion.”
The President also mentioned that the country is currently in discussions with countries that have expertise in the oil and gas sector to strengthen its policies and regulations.
“In this way, Namibia will not only escape the ‘resource curse,’ but proudly take its place among the league of oil and gas rich countries that are successfully managing these resources for the benefit of their people,” said Geingob.
This comes as the Welwitschia Sovereign Wealth Fund was launched in May to ensure that the benefits from natural resources are shared with future generations.
PSG Wealth Management Namibia has forecasted that Namibia will generate over N$12 billion in Foreign Direct Investment in 2022 due to increased investor confidence and opportunities in the oil and green hydrogen industries.
The financial service company’s forecast follows Namibia’s record net FDI inflows of approximately N$6 billion in the first half of 2022, compared to N$5.7 billion in the same period in 2021.
The Bank of Namibia predicts that the domestic economy will grow 3.9% in 2022 and 2.7% in 2023, though these estimates are higher than the 2.8% forecasted by Finance and Public Enterprises Minister Ipumbu Shiimi for 2022 and 3.4% for 2023.
