By Saima Nangombe
Even though closing the agreements on the African Continental Free Trade Area (AfCFTA) is a critical milestone, it won’t represent a success unless the bodies that will enforce the agreements are competent.
Considering Namibia’s potential to be a logistics and green energy hub, an evaluation of governance quality indicates governance has serious undermining aspects as well. This shows the country will be able to reap the benefits of the AfCFTA.
Namibia’s public procurement system, and specifically the Central Procurement Board, has several institutional strengths that lay the groundwork for trade.
Under the Procurement Act, which is the legal framework for the procurement system, the Board of Procurement ensures that competitive bidding for contracts is a legal requirement and that awarded tenders are published on an e-procurement portal.
This degree of transparency not only ensures that fair competition exists for government contracts within the AfCFTA, but it also draws foreign investments.
Perhaps most importantly, the need for independent judiciaries within a trade bloc is critical. The independence of a bench has, for example, been demonstrated in the landmark decision of the decriminalisation of same-sex acts.
The decision of the Judicial Service Commission to publicly advertise judicial posts is another positive development towards the meritocracy that traders and investors expect.
Nonetheless, there are gaps in data that may cause Namibia to lose its competitive edge. The most significant issue is the absence of open and accountable operational frameworks for state-owned enterprises (SOEs) and the exploitation of natural resources.
The financial details concerning SOEs remain inaccessible to the public, and some SOEs have not issued financial statements. Even those SOEs and SOE groups that do publish financial statements may satisfy themselves with incomplete, lackadaisical, and infrequent reporting, to the point of skipping quarters. The lack of financial transparency will mean that the market will lack fair value estimates and, like the investments the AfCFTA aims to counter, will lead to the investments the AfCFTA aims to counter.
The perception of politically motivated indifference, bolstered by the slow pace of prosecutions, including the much-delayed “Fishrot” prosecutions, will not improve trust in Namibia as a politically stable trading partner, despite the Anti-Corruption Commission continuing to investigate and dismantle criminal structures.
The most substantial data gap in evidence-based trade policy remains the lack of data. The Office for National Statistics legally constitutes an independent authority, and the office assumes that the assumption of a lack of technical resources does not impact independence. Since there has been no Labour Force Survey since 2018, this means that there are 5 years’ worth of lost data on one of the key indicators for measuring the AfCFTA’s socio-economic impact on employment. Without detailed and timely data on poverty, employment, and enterprises that are publicly accessible, the analyses imply that policymakers are ‘flying blind’.
Namibia’s institutional framework has the fundamental requirements for integrating into the AfCFTA, including the presence of a working procurement system and an independent judiciary. However, there is an urgent need for the improvement of the ecosystem of state-owned and extractive industries, the independence and effectiveness of the anti-corruption unit, and the ecosystems surrounding the timely, comprehensive, and integrated socio-economic information systems geared towards economic planning.
Enhanced governance on these issues is not a matter of compliance. With the AfCFTA now operational, the enhancement of economic transparency is an urgent economic imperative.
* Saima Nangombe is currently a Lead Researcher for the Namibian profile at the African Institute for Development Policy (AFIDEP), where she supports the production of governance indicators for the Africa Integrity Index, the World Bank’s Worldwide Governance Indicators, and the Mo Ibrahim Foundation’s Index of African Governance.
Her professional background spans development finance, economic policy, and stakeholder engagement. Saima holds a master’s degree in governance and regional integration from the Pan African University, a Bachelor of Public Management (honours) from the Namibia University of Science and Technology, and a certification in international energy policy from Sciences Po Paris. Her recent publications focus on topics including export diversification and regional economic integration within SADC.
