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‘Nandinomics’: Economic outcomes from ruling party’s elective congress

By November 29, 2022 2305 0
‘Nandinomics’: Economic outcomes from ruling party’s elective congress

Namibia’s ambitions to become a leading green hydrogen and fossil fuel producer remain undeterred by the ruling party’s elective congress outcome, which saw Deputy Prime Minister and Minister of International Relations Netumbo Nandi-Ndaitwah elected Swapo Vice President, making her the front runner to lead the party in the upcoming general elections in 2024, analysts have said.

“Ndaitwah's anti-corruption credentials mean she is in a good position to mitigate the corruption risks around both the oil discoveries and the green hydrogen plans,” Institute for Public Policy Research Executive Director Graham Hopwood told The Brief.

“The contest between Nandi-Ndaitwah and Kuugongelwa-Amadhila wasn't fought on ideological grounds so I doubt there will be any significant change in economic policy going forward. Ndaitwah's expertise is not in the area of economics so if she is later elected as President of the country, she will need good technocratic advice.”

Hopwood said the election of Finance Minister Iipumbu Shiimi to the SWAPO Central Committee, the highest decision-making body within the party, was a sign of confidence that the party has in his ability to handle the country’s economy which is forecasted to grow by 2.8% this year and 3.4% in 2023.

“Shiimi near the top of the CC list is an indication that the party has confidence in him as a safe pair of hands in terms of his handling of the economy even though he faces some difficult dilemmas. The congress has boosted his political prospects,” he said.

Former Director at The Namibian Economic Policy Research Unit, Prof Henning Melber, said the ascendance of Nandi-Ndaitwah as President Hage Geingob’s future successor and leader of the ruling party, was influenced by the need for continuity, a key attribute considered by many investors.

“Nandi-Ndaitwah's election is in my view a sign that delegates preferred continuity. Age-wise and in her political track record she remains closest to the old guard of struggle veterans retiring at the end of this legislative term. This suggests a certain degree of reliable hand over and therefore relative stability in terms of party internal stability, which also affects governance in general. To that extent, she is from the view of potential investors into Namibia's economy a good choice, since social and political stability is always an important criterion,” Melber said.

He said her success to turn around the fortunes of the country, should she be elected President come the next general elections, will be determined by her cabinet.

“She has, however, not any track record of economic policy competence and therefore she is unlikely to set the agenda in a way similar to HPP 1 and 2. She will have to rely on the competence of a team chosen. This needs not to be a worrying sign. After all, leaders who are able to consult and willing to listen are better than those who always believe to know best. It therefore much depends on how "Team Nandi-Ndaitwah" is composed and to which extent it shapes and implements policy collectively,” Melber said. 

“Her election is not yet a reliable criteria if this improves the economic prospects. The policy under her cabinet will be. It therefore is too early to judge or predict. As we know, external factors (and shocks) play a role, though should not be an excuse for non-delivery. But crisis management is a requirement in the current situation. If she is the team player, I hope she will be, this can only improve the conditions addressing the challenges. Potential investors (both local and international) will welcome this.”

Melber noted that it was too early to make predictions on the country’s prospect of becoming the continent's energy hub through hydrogen energy and the possible harvesting of oil and gas.

“This kind of resource extraction is a long-term investment, and its implementation will show who benefits from the transactions. Are the gains for a local elite (again) and international companies, or do the trickle-down effects benefit the ordinary people? It is too early for predictions. What in my view matters more, is an economic policy based on immediate needs - local is lekker in the sense that investment in available resources is a more important matter than the pipe dreams of future wealth through green and fossil energy production.

“Again, this requires a team which is aware and able to invest in what the country already has, instead of promising a golden future. People are now in need; they do not need visions but solutions. Maybe Nandi-Ndaitwah is the person who is pragmatic and realistic enough to foster such attitudes. The beneficiaries would be the people and her credibility, which at the end also means the party's gain.’

Namibia is banking on green hydrogen to attract more than US$6 billion in foreign direct investment (FDI) which is anticipated to generate annual revenues more than US$800 million.

Global oil majors, TotalEnergies and Shell announced earlier this year that they had made “significant” oil discoveries off Namibia, which the National Petroleum Corporation of Namibia (Namcor) estimates could generate US$5.6 billion in revenue for the country at peak production, which have the potential to double the country’s economy, which Bloomberg estimates at US$11 billion by 2040.

Consultant Wood Mackenzie estimates that Namibia discoveries could contain about 6.5 billion barrels of oil equivalent of recoverable reserves.

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Last modified on Tuesday, 29 November 2022 19:03
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