Namibia’s green industrialisation strategy will require a total investment of over US$55 billion (N$980 billion), a latest report shows.
The government and the GH2 Namibia programme have outlined a strategy to achieve this, allocating US$15 billion (N$267 billion) for crucial infrastructure development and an additional US$40 billion (N$713 billion) to attract investment into green industries.
The strategy notes that securing these funds will depend on innovative financing methods and effective public-private partnerships.
“The strategy estimates that infrastructure enablers, including rail and port facilities, will require over U$15 billion in capital expenditure. However, current spending commitments fall short of these needs, with a planned U$4 billion investment over the next five years, sourced from public, private, and development finance sectors,” the strategy reads.
Meanwhile, the strategy said the front-loaded nature of this investment necessitates innovative financing approaches.
“The required infrastructure investment far exceeds mid-term budget capabilities, making off-budget financing essential. Domestic and international private sector funding will be needed via PPPs, concessions, etc.,” the report states.
Furthermore, investable industries, including green hydrogen (GH2) production and green manufacturing, have an estimated capital expenditure of U$40 billion.
This includes Green HBI production, solar panel manufacturing, electrolyser manufacturing, wind turbine manufacturing, lithium refining, rare earth element (REE) refining, flat glass production, and synthetic fuel production, among others.
“Namibia must significantly increase foreign direct investment (FDI), which currently stands at U$6.3 billion, primarily in mining, tourism, and agriculture. While bankable projects will attract funds, this implies a five-fold increase in the total stock of FDI,” the report notes.
GH2 highlights that government support is crucial to mobilising these funds, noting that Namibia is a stable, attractive investing destination, but these projects are bigger than any previous.
“Government support is needed to broker relationships with donors, local firms, OEMs, and off-takers,” the report emphasises.
Additionally, a dedicated delivery capability is required to coordinate and convince investors.
“The government must formulate and pitch a blueprint that combines the languages of business and diplomacy,” it said.
This comes as Namibia’s rail infrastructure is a critical component of the strategy.
“Short-term plans include the Kranzberg-Otjiwarongo track replacement and Walvis Bay-Tsumeb signalling upgrades. Mid-term goals focus on the Otavi-Grootfontein track replacement and constructing a new track from Grootfontein to Katima Mulilo,” said the Strategy.
Moreover, long-term objectives include connections to Livingstone in Zambia and Lubango in Angola.
“Sector-wide initiatives such as rolling stock modernisation, supported by a U$114 million loan from the Development Bank of Namibia (DBN) and the Development Bank of Southern Africa (DBSA), and a €7.6 million pilot for hydrogen dual-fuel rolling stock (HyRail), are also critical components,” the strategy stated.
Similarly, expanding port capacity is also noted as vital to support regional trade and green manufacturing industries.
“Walvis Bay is positioned to become a major regional logistics hub. Short-term plans include a new South Port container concessionaire to dredge the channel for U$42.5 million and invest U$53 million in new handling equipment,” GH2 said.
Mid-term objectives involve developing a Greenfield North Port for over U$3 billion to serve the Southern African Development Community (SADC) and offshore oil and gas prospects.
Long-term goals include extending South Port to accommodate further regional trade and trans-shipment.
On the same note, Lüderitz, currently capacity-constrained and lacking deepwater access, requires significant development to support the green hydrogen potential.
“Short-term plans include extending the Robert Harbour quay to serve manganese export and green hydrogen construction. Mid-term objectives focus on developing a Greenfield Angra Point deepwater port, while long-term plans involve dedicated dry bulk and liquid bulk terminals to meet the specialised needs of clean energy industries,” the report highlighted.
