By Fimanekeni Mbodo
As Namibia enters 2025, the popular phrase “new year, new me” does not apply to the country and the challenges it faces.
Chief among those is the staggering unemployment, particularly among the youth, which continues to undermine hopes of national progress.
Contrary to the election fever rhetoric that promises jobs in exchange for votes, the only way to guarantee job creation is with a thriving business environment—one that only entrepreneurs can build. As we begin the new year, entrepreneurship must become more than just a buzzword in campaign slogans. It needs to be a concrete national strategy, supported by funding opportunities, intentional policies, and an enabling environment.
Risk Capital: Someone Has to Fund the Small Businesses
We’ve heard every excuse about why it isn’t responsible to lend to SMEs and why lending practices must be “robust” to protect capital. That’s until you read about yet another “entrepreneur” defaulting on hundreds of millions from the Development Bank. If large-scale borrowers with connections can fail so spectacularly, why are small businesses—whose funding needs are modest—being sidelined?
Namibia’s financial markets favour low-risk, high-capital ventures at the expense of smaller, riskier startups and SMEs. To get to where we need to go, our capital system must mature enough to accept that small business failure is part of the game, and that potential wins far outweigh losses.
Fortunately, the Namibian government has recognised this. Through the Development Bank of Namibia (DBN), they are working to establish a Venture Capital Fund (VCF) as part of the SME Financing Strategy. This makes sense, as small businesses employ a significant share of the workforce and contribute to the peace and stability we are so often reminded to appreciate.
However, to disrupt the status quo that favours the politically well-connected, the governance structures of the VCF must be thorough and transparent, ensuring fairness for all. If executed correctly, the VCF could catalyse private venture capital markets, encourage financial institutions to rethink lending policies, and inspire a culture of innovation and risk-taking.
Policy Progress: Encouraging, yet insufficient
Namibia’s government has made many commitments to entrepreneurship over the years, from SME support programmes to grants and funding incentives. However, the gap between policy and practice remains glaring. Entrepreneurs are often suffocated in red tape or sidelined by initiatives that seem designed for international donors rather than local realities.
They say the ungrateful man does not appreciate the sun until it sets, so it’s worth acknowledging the government’s progress on policy. One example is the Income Tax Amendment Act of 2024, which lowered the corporate tax rate for non-mining companies from 32% to 31% starting 1 January 2024, with a further reduction to 30% in 2025.
Reducing the tax burden will enable businesses to reinvest profits into growth, create jobs, and improve competitiveness. However, other interventions leave much to be desired. For instance, the Credit Guarantee Scheme, though well-intentioned, has struggled with limited awareness, slow and complex application processes, and an inability to fully address the collateral challenges faced by SMEs.
I could sit here and write about what isn’t working all day long, but that would be a waste of everyone’s time. What Namibia needs now is action. We have the ideas, the talent, and some of the policies. What we lack is consistent implementation and a collective sense of urgency.
2025 must be the year Namibia stops treating entrepreneurship like a side hustle and fully recognises it as a national priority. It’s time to bridge the gap between policy and practice, fund the small businesses that power our economy, and foster a culture where innovation is celebrated, not suffocated by bureaucracy. Perhaps when the Namibia Statistics Agency is ready to share the updated unemployment figures with us, it will wake us all up to this reality.
*Fimanekeni Mbodo is an entrepreneur and independent financial and business analyst. He has a strong background in Finance and Business, with a BCom in Financial Accounting from the University of Cape Town and a Postgraduate Diploma in Business Administration from the University of Namibia.
