Finance and Public Enterprises Minister Iipumbu Shiimi says the government is working to pass a new law to regulate the Welwitschia Sovereign Wealth Fund in the next two years.
The Fund, which is managed by the Bank of Namibia, was launched in May last year and is currently capitalised to the tune of N$300 million.
“We are working on the law. We are hoping to pass that law within the next two years or so, so that we create a legal framework to be able to harvest our plenty when we have plenty,” Shiimi said.
The Minister added that a policy framework has been approved by the government and work is now being done to translate the framework into law.
Shiimi said the Fund will help the government to save for rainy days.
“When we have significant revenue and we are headed in that direction, there are some significant resources that have been found in the oil sector, we are talking about rare-earths, we are moving in that direction where we will have some years of plenty so what are we going to do with that plenty?” he said, adding that “the SWF is created for that purpose”.
SWF will collect some of the royalties from all mineral resources sold as well as some tax revenues and money raised by the government divesting from its investment holdings.
Namibia launched a sovereign wealth fund, months after oil discoveries by oil giants TotalEnergies and Shell off its coast. The Fund is anticipated to invest 2.5% of its portfolio locally to fund Namibia’s infrastructure gap.
Hyphen Hydrogen Energy, which has won two bids to construct Namibia’s inaugural green hydrogen projects, has committed 2.5% of the annual revenue to be generated from the project to go to the Fund.
“We are looking forward to the prospects and opportunities that will emanate from the recent discoveries of oil and the green hydrogen energy, which have the potential to further boost the fund’s capital,” President Hage Geingob said at the Fund’s launch last year.
