Namibia’s import and export bills amounted to N$361 billion and N$267 billion respectively over the past three years, resulting in a trade deficit of around N$94 billion, official figures show.
This comes when in the same period the Bank of Namibia uncovered over N$1 billion in fraud related to clearing and customs under the guidance of the National Technical Working Group (TWG) on illicit financial flows (IFFs).
Namibia, like most African countries, faces resource-linked illicit financial flows (IFFs) in mining and fishing, the UN Trade and Development (UNCTAD) says.
“In Namibia, we have observed this phenomenon through previous work, particularly in the trade of mining and fishing. Trade misinvoicing and profit-shifting practices have been the primary focus in these sectors,” Bojan Nastav, a Statistician at UNCTAD told The Brief at the Bank of Namibia and the United Nations National Workshop and Training on the measurement of IFFs in Namibia.
The workshop, which concluded on Friday, 17 May 2024, convened members of the TWG, including key government offices, ministries and agencies as well as non-state representatives such as statisticians, economists, policymakers, development experts and trade experts, to align Namibia’s strategy to address IFFs.
During the workshop, the Chairperson of the TWG on IFFs and Deputy Director for Exchange Control at the Bank of Namibia, Penelao Kapenda highlighted that the fight against IFFs is neither for the timid nor the fearful.
She encouraged the members of the TWG to seek assistance and be set for nation-building.
“With the support of the international community, let us build the necessary capacity and identify the drivers of IFFs using refined and additional methodologies. We must be diligent leaders who influence policy changes for our generation and enable the State, under the Namibian Constitution, to enact, administer and enforce laws effectively, ensuring the recovery of Africa’s stolen assets through IFFs,” said Kapenda.
Meanwhile, Nastav also noted that IFFs thrive in chaos, but can be addressed reasonably through cooperation, and communication between national agencies, international agencies and countries, as well as strong political will.
He commended Namibia for involving the Deputy Minister of Finance and Public Enterprises, noting that it shows commitment by the Namibian Government to addressing IFFs.
As part of the workshop outcomes and future work, the TWG will be equipped to measure tax and commercial IFFs, identify policy gaps and develop further estimation and policy recommendations. These efforts will align with the project timeline to ensure sustained and comprehensive action against IFFs.
At the opening, Deputy Minister of Finance and Public Enterprises Maureen Hinda-Mbuende highlighted the significant impact of IFFs on Namibia and the broader African continent.
Regarding Namibia’s trade imbalances, she said these figures underscore the urgent need for fair trading practices and enhanced oversight.
“How much of such excessive value of trading was conducted under fair market practices, on the correct and accurate invoice, with appropriate tax charges and with the assurance that fees were not transferred to any international tax haven accounts which enhance the inner working of the secret economy that benefits only the rich, the powerful and the criminally minded,” she said.
