The Bank of Namibia (BoN) has called on the country’s financial sector to position itself to capture opportunities arising from the emerging oil and gas industry, warning that Namibia must ensure local businesses and institutions play a meaningful role in the sector’s development.
BoN Governor’s Technical Advisor Romeo Nel said the country’s anticipated oil and gas boom could transform the economy, but cautioned that success would depend on how effectively Namibia builds local capacity and participation across the value chain.
“Namibia stands on the edge of significant transformation with the emergence of a new economy driven by the oil and gas sector, which is expected to bring economic prosperity to all Namibians. This is a tall order that rests not only on the shoulders of national institutions but also on market players. We must work together to navigate the opportunities before us and ensure that ordinary Namibians, as well as local institutions, are not merely spectators in this emerging economy,” he said.
Nel said the financial sector has a critical role to play in supporting investment, financing local enterprises and helping to build domestic industrial capacity linked to the energy industry.
Drawing on lessons from other resource-rich countries, he noted that the largest economic gains from oil and gas often come after production begins, through downstream industries and supporting services rather than from extraction alone.
According to Nel, only about 25% of energy sector revenues are typically generated from upstream activities, while roughly 70% originate from downstream industries and value-added activities.
“This suggests that our focus should extend beyond fiscal measures to include local participation, local content development, value addition, beneficiation, and capacity building to ensure that the benefits of the industry are felt throughout the economy,” Nel said.
His remarks come as Namibia moves closer to becoming an oil-producing nation following a series of major offshore discoveries that have attracted billions of dollars in investment from international energy companies.
The central bank believes that without deliberate efforts to strengthen local participation, much of the value generated by the sector could flow outside the country.
Nel said collaboration between government, financial institutions and private sector players will be essential to ensure Namibians benefit from the opportunities expected to emerge across the broader oil and gas value chain.
The comments also highlight growing calls for stronger local content policies as Namibia prepares for large-scale energy developments that are expected to reshape the country’s economic landscape over the coming decade.
