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STRATEGIES FOR A SOVEREIGN WEALTH FUND AND EMPOWERMENT FUND IN NAMIBIA

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An Economic Study To Assess The Various Effective Mechanisms On How To Implement A Sovereign Wealth Fund And Empowerment Fund In Namibia
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STRATEGIES FOR A SOVEREIGN WEALTH FUND AND
EMPOWERMENT FUND IN NAMIBIA
An Economic Study To Assess The Various Effective Mechanisms On How
To Implement A Sovereign Wealth Fund And Empowerment Fund In Namibia
HARVEST INVESTMENT – NAMIBIA
DATE: 01 September 2021
AUTHOR: RODNEY HOAEB
rondey.hoaeb@gmail.com
https://www.researchgate.net/profile/Rodney-Hoaeb
2
TABLE OF CONTENTS
EXECUTIVE SUMMARY ..................................................................................................... 5
1. INTRODUCTION – SOVEREIGN WEALTH FUND ................................................... 7
2. EMPOWERMENT FUND POLICY ANALYSIS ........................................................ 10
3. SUPPORTING ANALYSIS FOR A SOVEREIGN WEALTH FUND AND
EMPOWERMENT FUND .................................................................................................... 14
4. NAMIBIA’S INVESTMENT POSITION ..................................................................... 24
5. GLOBAL GROWTH OF SOVEREIGN WEALTH FUND ASSETS .......................... 29
6. SWF – AN ENABLER FOR SUSTAINABLE DEVELOPMENT ............................... 30
7. THE CORRELATION BETWEEN FDI AND INEQUALITY .................................... 32
8. SWF AS A TOOL FOR ECONOMIC STABILIZATION ........................................... 35
9. THE CURRENT STRUCTURE OF INVESTMENT FUNDING IN NAMIBIA ......... 36
10. FUNDING SOURCES FOR A SWF ............................................................................. 39
11. TARGETED INVESTMENT AND SECTORS ............................................................ 41
12. CONVERGENCE OF TECHNOLOGY AND INVESTMENT IN AFRICA ............... 43
13. SWF AND FOREIGN RESERVES ............................................................................... 45
14. SUMMARY ................................................................................................................... 47
15. TABLES AND CHARTS .............................................................................................. 49
16. BIBLIOGRAPHY .......................................................................................................... 52
GLOSSARY
GDP Gross Domestic Product
NEEEB National Equitable Economic Empowerment Bill
SWF Sovereign Wealth Fund
HPP2 Harambee Prosperity Plan Two
PPP Private Public Partnership
SME Small and Micro Enterprises
AuM Assets Under Management
UN United Nations
BoN Bank of Namibia
SDG Sustainable Development Goals
3
Acknowledgements
I would like to thank my dearest life-long partner and wife Vanessa for
her patience, support me during all the challenges and good times in
my life, you are a blessing in my life including my children Rodger,
Elijah and Hannah.
I acknowledge my dear parents Dr. Ochurub and Ms. Erna Ochurus,
brothers and sisters, nieces, cousins, uncles and aunts. I acknowledge
your love and support, daily calls and eternal encouragement so I can
be the best in anything I do, I love you all.
Most Importantly this is dedicated to my late mother Lisa and granny
Lisa, I thank my heavenly father for you even though you departed,
thank you for making me believe in prayer as a solace.
To all my Friends and their lovely families, I am very grateful.
I dedicate this research to the forefathers of the African soil, the tribal
chiefs and elders that sustained our tribes throughout the ages and met
their economic needs without greed or prejudice, yet having no
economic credentials, only by obeying divine instructions.
God bless Namibia
Anyone who believes exponential growth can go on forever in a finite world
is either a madman or an economist”.
Kenneth Ewart Boulding
4
INFORGRAPHIC – CURRENT SWF’S IN AFRICA
By: Rodney Dan-Ao !Hoaeb
source of data: https://www.swfinstitute.org/fund-rankings/
LIBYA
$67 BILLION
CAPE VERDE
$ 122 MILLION
ANGOLA
$3.2 BILLION
GHANA
- $330 MILLION
- $455 MILLION
- $ 521 MILLION
NIGERIA
- $2.5 BILLION
- $ 1.5 BILLION (BAYELSA)
MAURITANIA
$159 MILLION
UGANDA
$120 MILLION
DJIBOUTI
$120 MILLION
GABON
- $142 MILLION
- 870 MIILLION
ZIMBABWE
$97 MILLION
RWANDA
$205 MILLION
EQUATORIAL GUINEA
- $165 MILLION
5
Executive Summary
The Namibian economy challenged with stagnant growth with a repeating
pattern of recessions, these growth constraints threaten the Gross Domestic
Product (GDP) stability unless new alternative investment and empowerment
measures are introduced. The global financial sector is evolving with the swift
pace of innovation, which excludes many under-developed economies while
setting the developed economies in a favorable position. Domestic financial
stability plays a critical role in any countries development and has far-reaching
benefits for its citizens and corporations. Any country should prioritize its
domestic stability as a stepping stone to later export its services to its neighbors
or regional, multilateral or international partners.
Well-tailored financial instruments can be linked to developing sectors within
the economy to boost domestic production to sustain stronger industrial output
and achieve export growth. One such instrument is the Sovereign Wealth Fund
(SWF), as it ensures collective national commitment towards domestic
economic and development objectives.
Firstly, the Sovereign Wealth Fund (SWF) fund ensures growth for the benefit
of the country and also doesn’t operate along the regulatory boundaries or
limitations of commercial banks, unlisted investments, or stricter development
bank regulations as it is in essence a fund that goes directly to the market and
undertakes business under the guidance of the state. Uniquely, unlike other
funding initiatives and grants, a sovereign wealth fund is instituted to generate
revenue through equity.
Secondly, Namibia requires empowerment policies to solve inequality, however
such policies should promote cooperation between business owners and
enterprises without an unbiased legislative bottlenecks. It is very important to
make clear definitions about how these policies and their intention, their
implications and targeted development results. This requires economic or
research-based evidence to make impact assessment to ensure where it is
required or not, how effective it will be and what results will manifest. Such
policies always carry the pressure of political weight can easily derail impactful
economic goals, if not carefully defined and applied they will threaten economic
confidence and lead to business closures. This research provides suggestions on
how to achieve a healthy and lasting policy position.
6
Thirdly, National Empowerment Funds signifies targeted developed funding
which is equitable and fairly disbursed among targeted an age groups, gender,
veterans, orphans, women, etc. The purpose of an empowerment fund is to
facilitate active economic participation for various potential role players in the
economy that are excluded by stricter market and industry requirements. The
government needs stronger initiatives to reach out to the informal segment and
those that are excluded from the industry because of formality cliches.
Economic
Developmen
t Policies
Sovereign
Wealth
Funds
Finance &
Investment
Equity &
Acquisitions
Export
Finance
Long term
Invesments
Domestic
Debt
Finance
Wealth
Creation
Innovation +
New
Ventures
GDP
Sectoral
Growth
Boost Local
Investment
Fund
Developmen
t Policies
Equality &
Empowerm
ent Bill
NEEEB
Public
Procurement
National
Empowerm
ent Fund
Develop
Regions
Funding and
Capital
Women &
Youth Fund
Proposed SWF and Development Policy Implementation Strategy for Namibia
7
1. IntroductionSovereign Wealth Fund
1.1 Benefits and Challenges
A sovereign wealth fund is a state-owned investment fund comprised of the
money generated by the government, often derived from a country's surplus
reserves. (Investopedia)
1
It also provides financial stability for domestic
investment and averts economic disasters.
Benefits
Challenges
§ Operates on revenue creation unlike grants.
§ Assists Government to have fallback funds
during any disasters.
§ Creates employment through innovation and
other initiatives.
§ Revenue should benefit the government and
strengthen tax base, not individuals
§ To curb corruption and self-enrichment by
political parties, thus boosting investor
confidence.
§ Wealth creation and fair regionally and
international market representation.
§ Ability to Support PPP Policy Initiates.
§ Ability to support Empowerment funds.
§ Ability to boost the Harambee Prosperity
Plan 2 Objectives.
§ Money is a game changer to raise macro
enterprises.
§ Curbs the begging trend for social needs and
grants, which leads to less interference over
democratic decisions.
§ Avert or manage financial catastrophes like
recessions, stagflation or any crisis linked
with global financial collapses.
§ It can harness the development skills of local
investors and venture capitalists in Namibia.
§ Namibianization and local Beneficiation
require finances to thrive, without money it is
ambiguous to implement value chains.
§ Political Intervention is possible
if regulations and ethics are not
imposed.
§ Implementation issues such as
funding, commitment.
§ A structural adjustment will take
time.
§ It will take a while to find its
niche and stable success.
1
https://www.investopedia.com/terms/s/sovereign_wealth_fund.asp
8
1.2 Proposed Fund Structure (Summary)
1) Regional Growth and Support Cater for development cooperation by
investing in regions.
2) Discover Targeted SectorsThe research provides how the fund can be
streamlined to achieve growth and where funding shortfalls exist.
3) Domestic Debt Financing opportunities The research discovers the
potential of debt financing and how an SWF can capitalize in the financial
sector and curb foreign dependence.
4) Equity and Acquisitions There are various financial institutions and
private companies that have suitable portfolios for local investment where
the SWF can assist.
5) Boost Export Finance and logistics infrastructure such as trucks,
warehousing, bonded warehouses, etc.
6) Encourage incentives and joint ventures such as guarantees, land, mineral
rights, etc.
7) Propose reliable Regulations, Ethics and Standards for transparency and
reliability.
1.3 Current Economic Challenges
The concerns below require a new set of development policies that will address
widespread economic growth challenges.
1) The currently adopted development policies lack credibility outcomes
that demonstrate their effectiveness since their inception leading to a lack
of trust as effective to alleviate poverty or to drive empowerment.
2) Private Sector companies are experiencing enormous economic growth
challenges in the current environment of negative GDP growth. Other
macroeconomic setbacks consist of investment red tapes, regulatory
policy uncertainty and the market size.
3) The fiscal balance is drenched under immense debt and unable to fund
new economic growth ventures or lack the capacity to propose novel
monetary commitments.
4) There is high unemployment and investment can be a means for resolving
this crisis, especially by strengthening small and medium industries.
5) The commodity prices are posing a higher risk to Namibia’s monetary
stability, such that when commodity prices drop the multiplier effects
9
reverberate throughout all sectors of the economy and suppressing
revenue from levies, royalties and taxes. There is a need for creating
financial safety nets to avert such challenges. This is one attribute of oil-
rich countries to leverage on diversified income in cases when oil prices
slump.
6) The current direct transfers towards Defense, Education, Health and other
Social safety-nets do not generate many returns which creates a skewed
revenue position. The costs of maintaining such expenses and the wage
bill drag the government into further debt.
7) There is a need to create self-reliant government bodies that generate high
streams of income.
8) Government Guarantees are limited in backing turnkey projects, thus
making it impossible to plan and implement capital projects, often the
government turns to other development banks and makes additional debt
to implement projects.
9) The Public-Private Policy (PPP) requires money and guarantees to back
a majority of such capital projects but investors have embedded
requirements that relies on sureties or guarantees for their investments.
The limited funds in Namibia will most certainly delay investment
participation.
10) If the government is unable to partner in various investment ventures
with capital-backed equity, the investors are left with no option but to
fully privatize the ownership of various capital resources, reducing the
economic gains intended for the country as a whole. As the cliche states
“it takes money to make money”, or “nothing is for mahala”.
The possibilities offered by a sovereign wealth fund is broad and if well
implemented has capability and responds effectively to a plethora of economic
challenges in Namibia.”
10
2. Empowerment Fund Policy Analysis
2.1 Namibia Equitable Economic Empowerment Bill (NEEEB) Analysis
In my opinion, the widest contradiction of Namibia Equitable Economic
Empowerment Bill (NEEEB) is to enforce equitable business ownership for the
black masses from the entities (Government of Namibia, 2015) that are
dominantly white-owned. In reality, ownership or equity sharing is not as
simplistic but very complex and erupts conflicts situations that destroy
companies. Equitable ownership does not directly address cross-cutting
problems of economic inequality or inclusive wealth distribution. The are
various subjective principles that contribute towards stable ownership in a
business such as leadership attributes, bolder affiliations, trust, and beneficial
relationships. Enforced ownership sharing to score public procurement points
or winning government tenders is an ineffective and risky strategy.
The government argues that it achieved little success to close the gap of
inequality gap within the 30 years of independence, after years of apartheid
segregation and racial inequality. The controversial NEEEB Bill was criticized
as reverse-racism and that it stirs panic by financially exploiting white business
owners.
In my suggestion, a more preferable pillar of NEEEB is the Management
Control and Empowerment Equity pilar that requires equal sharing of
management or executive roles within various organizations. This will promote
fairness and sharing of fringe benefits, compensation, employment equity, and
executive management roles for all. (GRN, 2015)
a. Targeted Sectors for NEEEB
If established, NEEEB can be focused on non-sensitive economic sectors to
encourage equal sharing of economic resources without causing any harm to
private sector.
1. NEEEB in Government Procurement:
The criteria for procurement are decided by the government for their
sovereign objectives. No international protocol is violated as other
countries adopt laws for the protection of national interest and their
underprivileged citizens.
11
2. Financial Services Sector:
The financial sector plays a major role as a central link to various business
and industrial services. Currently, Namibia has a skewed ownership or
control of financial services whereby the masses are excluded.
3. Sovereign Wealth Fund Subsidies for Primary, Secondary &
Tertiary Sectors:
The government and other financiers can provide subsidies to boost the
GDP for companies in the Primary, Secondary and Tertiary Sectors. This
will encourage economic participation for those that are previously
disadvantaged and to encourage partnerships with companies that are
already established. Subsidies will enhance skills and production capacity
to boost production and output. Companies can take advantage of such
funding to expand towards other African markets.
A strategic sector that requires subsidization is the construction and
engineering sector.
Subsidies help local companies to grow and become more competitive
against foreign companies which boosts local supply and reduced
imports.
b. Fairness and Transparency of NEEEB
The government should introduce measures to encourage businesses
participation and partnerships among people from diverse backgrounds in the
least controversial manner, considering its mandate to protect the welfare of all
its citizens.
Additionally, NEEEB must be fair to all members of the black community
without favoring only a few selected individuals through nepotism and
corruption. The Government of Namibia was recently under public criticism
about the unfair distribution of fishing rights and resettlement farms. This is a
litmus test for the government to demonstrate its intentions for fairness and
equality. The other point of public contention is the selection process for the
board of directors of various state-owned enterprises (SOE’s) and recruitment
in those agencies which was perceived as biased and unfair.
The other constrains of NEEEB is the inability to raise capital that will fund the
proposed ownership strategies. It is not viable for SWFs to provide equity for
individuals as it will compromise transparency and trigger abuse and
irregularities and corrupt practices and possibly nepotism.
12
Fair empowerment is best achieved through National Development Fund
Initiatives. NEEEB will burden the government on implementation cost, trials
and possible sector instabilities, but National Development Fund can generate
its income and be self-reliant. NEEEB is not structured or qualifies to deal with
diverse economic sectors, it lacks the prowess to provide full accountability and
justification by fitting a targeted economic principle of equality. Race and
origins in the long run, do not accelerate growth for everyone, but only some
based on racial identity and not competence. When policies conflict with the
free market system by promoting interference in the market it will severely
frustrate the bona fide principles of those sectors.
In conclusion, a sovereign wealth fund is better equipped to be a custodian of
primary resources, as NEEEB is not transparent enough and these resources will
end up with those in the proximity of power and connections at the expense of
the poor.
2.2 National Empowerment Fund
Economic inequality, marginalization and poverty remains a core threat to the
Namibian economy as there is a divide between the rich and the poor (as per
Gini-Index). Development does not reach people in remote areas, which triggers
mass urban migration as people seek greener pastures.
Structurally a national empowerment fund has the ability to tackle financial
inclsuitiviy and involvement of communities, businesses, youth, women and
SME’s into the mainstream economy.
It will serve to integrate smaller and micro enterprises into the formal enterprise
and promote business confidence to those locked outside the perimeters of
prosperity .
Transparency and ethical business practices however will remain a key
checkpoint and to ensure that funds are allocated fairly and that such enterprises
are monitored.
As mentioned earlier, an empowerment fund can be structured to deal with the
financial interventions for participation in policies such as NEEEB, in a way to
promote enforced accountability, standards and monitoring.
The fund can easily promote training and mentoring strategies to equip potential
companies. International venture capital funds and mezzanine investments are
always seeking communities they can collaborate with on a regional level to
13
carry out some business ventures, this can structurally blend with available
resources, skills demonstrated by the participants of an empowerment fund.
Most SMEs in Namibia survive through bootstrapping and operate only as
briefcase companies. It is a one-sided judgment to argue that they are not
competent enough to give compete with already established companies. The
government must do its own introspection and assess whether enough support
is given to SMEs and functionalize them as the wheels of the economy.
The agricultural sector requires empowerment funding to boost its seasonal
production and setup structured funds to encourage women and youth
participation.
2.3 NEEEB versus the National Empowerment Fund
The government is strained by investing in development policies as it requires
finances to implement and maintain. They need financial support from a
proponent such as the SWF to fund the regulatory framework, planning,
assessment and funding of various development policies.
A National Empowerment Fund requires such funding to fund projects at
the grassroot level and empower its target groups. The idea of having a
National Empowerment Fund supersedes the functions of a policy such
as NEEEB because empowerment maintains healthy and conducive
private sectors without imposed conditions. Thus, if incumbents which to
buy equity in private companies, it is done on merit with prospects of
making revenue and competitiveness.
NEEEB funding is a development policy that is ideal for public
procurement, additionally it is not advisable for the government to fund
private equity for individuals buying NEEEB related dividends in private
companies, defeats the purpose of transparency and is susceptible to
abuse.
14
3. Supporting Analysis for a Sovereign Wealth Fund and
Empowerment Fund
3.1 Structure of a SWF
The analysis below highlights the various investment opportunities that exists
for SWFs in the following sectors:
a. Finance and Investment
Equity & Acquisitions
To obtain equity on behalf of the nationals in strategic sectors such as mining,
banking, services industry such as insurance companies, multimedia companies,
communications, energy projects, warehouses and distribution centers, etc.
Namibians have a low representation in the financial sector, most companies are
owned by multinational corporations, it becomes difficult to change or tune the
game favorably, therefore many emerging companies are discouraged on the
onset to compete with these companies and remain outside the periphery of
growth. As mentioned, money is a game-changer, people need to dictate
businesses and policies in the financial sector for the benefit of growth, not the
other way around, exclusion is totally non-permissible.
Sovereign
Wealth Funds
Finance &
Investment
Equity &
Acquisitions
Export Finance Long term
Invesments
Domestic Debt
Finance
Wealth Creation
Innovation + New
Ventures
GDP Sectoral
Growth
Boost Local
Investment
Fund
Development
Policies
15
Export Finance
Namibia is strategically placed to dominate the logistics and supply chain within
the SADC region, also with the implementation of the African Continental Free
Trade Agreement (AFCFA). There is an assumption that you only export what
you manufacture, however logistics is the back-bone of trade and it ensures that
products move from point A to point B, benefits include financial services,
warehousing, storage, spending in towns and support of local tourism in those
towns. The concept of export financing is a robust step in countries that are
building economic zones as they view themselves as intermediaries in the
product supply chain, a sector area where Africa can discover more growth.
Hence businesses require funds to buy stock for export or subsidies for
intermediary goods to boost production.
The table below demonstrates Namibia’s trade balance (Exports-Imports),
demonstrating a high trade deficit on imports over exports. There is room for
increasing domestic exports and curbing imports in order to retain a positive
trade balance. The trade deficit was -53% in 2020 and therefore the local
Namibia must manufacture more products locally to boost its manufactured
exports. This will require financial support for various economic sectors and
value addition in the secondary sector.
The trade balance has a direct bearing on the GDP of Namibia and remains
imperative that domestic production must increase to observe GDP growth.
Table 1: Expenditure on GDP Constant 2015 prices - N$ millions
2014
2015
2016
2017
2018
2019
2020
Exports of goods &
services
58,673
51,648
51,334
52,332
60,662
54,986
45,259
Imports of goods &
services
90,000
90,339
93,894
84,410
85,484
82,111
69,224
Trade Balance (%)
-53%
-75%
-83%
-61%
-41%
-49%
-53%
Gross domestic product at
market prices
140,047
146,019
146,068
144,568
146,169
145,283
133,685
The chart below compares government and private expenditure as a fraction of
foreign expenditure (import). We can conclude from the chart that the
government spend more on imports, compared to the private sector.
16
Chart 1: Capital Flight from Public and Private Expenditure
(Namibia Statistics Agency, 2021)
Eita, Mosikari, Senosi carried out a study in 2016, to investigate the impact of
export and manufactured goods towards growth in the Southern African
Development Community (SADC) region. It was found that total manufactured
exports contribute about 5% to economic growth. (Teboho Jeremiah Mosikari
M. C., 2016)
In another study conducted by Eita,Moskari (2020) it was discovered that a 1%
increase in exports of manufactured goods leads to a 0.344% increase in
economic growth in Namibia and that a 1% decrease in exports of manufactured
goods will leads to a 0.080% decrease in economic growth for Namibia. A 1%
decrease in imports of machinery and other hardware products leads to a 0.227%
decrease in growth and a 1% increase of the same leads to a 0.104% increase in
economic growth. (Teboho Jeremiah Mosikari J. H., 2020)
It is thus very important to encourage manufacturing and manufacturing value
addition(MVA) in the economy to realise long term growth.
Domestic Debt Finance
The Namibian government is accumulating annual debt at a higher trajectory,
this yields in treasury bond subscriptions only favor an enclosed circuit of
companies (with the inclusion of some local firms and the Government
Institution Pension Fund-GIPF). However, if more local funds are generated the
SWF can buy government debt at a cumulative rate and also boost its income.
Domestic debt issuance safeguards the government from currency fluctuations
and monetary outflows. It also helps the economy to become self-reliant. The
-50,000
-40,000
-30,000
-20,000
-10,000
0
-150%
-100%
-50%
0%
2013 2014 2015 2016 2017 2018 2019 2020
Public and Private Expediture on Imports Goods (2013
-2019)
Percent to Private Spending Percent of Public Spending
Capital Flight (N$ MLN)
17
government is faced with a dilemma of an unjustifiable wage bill. Subsequently,
government retrenchments will only breed more unemployment. The
government requires more profit-generating entities to diversity its sources of
revenue which is currently linear and not viable for an unforeseeable future.
b. Wealth Creation
Innovation and New Ventures
Explore innovative projects and discover new industries of business driven by
innovation shifts and next-level ideas such as software development, smart
cities, internet connectivity to rural areas, agricultural technology, research,
food processing, etc. There is a gap in Namibia for investing in ideas as they
require capital during startup, however most innovations solve critical everyday
problems and have the capacity to expand internationally.
Innovation and tech are leading businesses in first world countries, it also
attracts youth and motivates them to cultivate new ideas and develops, equips
or challenges them to evolve towards global business trends.
c. GDP Sectoral Growth
Boost Domestic Investment
As alluded to earlier most businesses and SME’s face liquidity constraints and
they are unable to compete with global enterprises that invade and eliminate the
local value chain in supply, distribution and manufacturing. With financial
support, these companies will be able to manufacture at a competitive rate and
also to consider export market expansion. If the business is under strain to be
self-reliant, with financial capital investment, they will not be able to expand.
The GDP is divided into various sectors such as Primary (Mining, Agriculture
or mostly extraction related industries), Secondary Sector (Construction,
Production and Manufacturing), and Tertiary Sectors (Services, Transport,
Finance, Retail, Wholesale, etc.) The GDP experiences severe setbacks if these
sectors are not stimulating any growth. These sectors account for all private
consumption. They also play a major role in employment creation. The trade
balance is a key element that determines GDP growth and as a variable of
measuring the GDP, a positive trade balance increases the GDP rate and depicts
that exports exceed imports, thus also maintaining a positive current account (or
balance of payment).
18
3.2 Current GPD Analysis (2014 2020)
The analysis below indicates a trend of the % GDP change at constant prices for
the years 2014-2020, per sector.
Point A: Repetitive cycle for Primary sector, this is predominantly
because of a very volatile farming and mining outputs.
Point B: Demonstrates exponential GDP growth potential for the Mining
and Agricultural sector. The agricultural sector is susceptible to
environmental shocks, and mining to commodity prices and extraction of
ores.
Point C: GDP indicates a very strong link to the Secondary and Tertiary
sector, primarily because the tertiary sector makes up 60% of GDP, this
can translate the potential that exists in this sector as well as the
motivation to encourage ownership, empowerment, and competitiveness
within the Tertiary sector.
The NEEEB empowerment pillar is useful for empowerment interventions
within the tertiary sector.
Chart 2: GDP % change at constant prices (2014-2020)
-20.0
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
2014 2015 2016 2017 2018 2019 2020
GDP Annual % Change
GDP % Change at Constant (2014-2020)
Primary industries Secondary industries
Tertiary industries GDP at market prices
A
B
C
19
a. GDP Estimation after SWF Implementation in Namibia
The table below indicates the GDP of Namibia from the year 2020 as the base
year, the current data for 2021 is not yet available, it then demonstrates the
potential income if a 2% to GDP SWF fund is established, with a total of N$ 3
billion initial start-up fee. The funds, in this case will be invested in all sectors
of the GDP (primary, secondary and tertiary) where the fund can realize returns.
The analysis siss based on all things being equal and the best-case scenario. If
the N$ 3 billion dollar funding is recorded as government expenditure, it can
reflect a similar shortfall in the state budget, however, if it is reflecting as an
investment, it can still be deemed as an asset to the state and not a liability.
Table 2: An assessment of 2% Sovereign Wealth Fund on Namibian GDP
2020
Y1
Y2
Y3
Y4
Y5
Y6
Y7
Y8
Y9
Y10
FUND SIZE IN GDP
(N$ BILLION)
0
3
4
6
7
9
11
14
17
21
25
GDP (N$ BILLION)
134
137
141
146
154
163
174
188
205
226
251
PERCENT TO GDP
0
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
Namibia applies the Harrod-Domar framework for its growth parameters to
measure GDP growth applying the following formula:
2
𝑌 = 𝑓$
(
𝐾
) Output/Gross Income is a function of Capital Stock.
𝑠𝑌 = 𝑆 = $𝐼
Savings rate and output/income equals Savings, and
also equals investment.
Thus, according to this model Investment has a direct relation to GDP growth.
Increased savings and increase investments lead to higher capital and boosts
economic growth.
2
https://www.tutor2u.net/economics/reference/economic-growth-harrod-domar-model
Increased
savings
Increased
Investment
Higher
Capital Stock
High
Economic
Growth
20
The chart below indicates Namibia’s GDP growth from 2014 to 2020. The chart
also indicates a GDP trend with a prediction if a SWF fund of 2% GDP was
implemented in Namibia. GDP growth is not homogenous as there are various
factors the impact growth. The analysis uses a constant target line to estimate
potential outcomes if the startup funds are fixed on a certain amount and how
this can encourage future GDP growth. The extreme situations however need
further expansion and a direct sectoral approach as well as a risk assessment to
measure operational and funding strategies to gain revenue. Considering the
various options provided on growth policies, it is also important to unpack its
feasibility, considering Namibia’s current economic variables.
Since 2014, the country has been experiencing negative growth, with the
exclusion of the year 2017.
Chart 3: GDP Growth at constant price (2014 – Y1)
Estimated SWF Adjustment (Only for Data)
3.3 Sectorial GDP analysis if a SWF is Implemented in Namibia
If an SWF is implemented in Namibia, the funds will proportionately be
invested in the Primary, Secondary and Tertiary subsectors. As per table 2, the
sectors are different in composition, for example, the primary sector is 17% of
GDP while secondary is 15% and tertiary 60%. The percentage growth for the
sectors between 2019 and 2020 is primary (-1%), secondary (-14%), and tertiary
(-5.6%).
-9.0
-7.0
-5.0
-3.0
-1.0
1.0
3.0
5.0
7.0
9.0
2014 2015 2016 2017 2018 2019 2020 Y0 Y1
GDP - Constant 2015 Prices - Average Price Change (2014 -Y1)
GDP at market prices GDP ESTIMATE (2% SWF)
21
Table 3: An assessment of 2% Sovereign Wealth Fund on Namibian GDP
Industry
2019
2020
Difference
% Growth
GDP
Composition
2% SWF
Subsidy
Y1 Expected
Growth N$ mill
Primary industries
24,178
22,714
-6.1%
17.0%
2%
454.27
Secondary industries
24,531
21,002
-14.4%
15.7%
2%
420.04
Tertiary industries
85,951
81,151
-5.6%
60.7%
2%
1623.02
GDP at market
prices
145,283
133,685
-8.0%
100.0%
2%
2497.34
Hypothetically, not all economic sectors grow at the same rate in the event when
with and with the support of the flat-rated financial stimulus. There is however
a correlation between money economic productivity and sectoral boom. It is
important to carry out an assessment or feasibility to measure if the funds will
stimulate sustainable growth in the economy. Additionally, some sectors require
expensive resources to manifest growth.
Chart 4: SWF Sectoral Growth Assessment
Trade balance as fraction of private sector expenditure and percentage of
government spending.
-35.0%
-25.0%
-15.0%
-5.0%
5.0%
15.0%
25.0%
35.0%
45.0%
Agriculture & Fishing
Mining & quarrying
Manufacturing
Electricity & water
Construction
Wholesale Retail
Hotels and restaurants
Transport & storage
Information
Communication
Financial & insurance
Real estate
Professional, scientific
and techical services
Administrative services
Public administration
and defence
Education
Health
Sectoral Growth Assessment
Difference% 2019 2020 2.4-BLN Cap 8-BLN Cap 20-BLN Cap
22
3.4 Domestic Debt Analysis and the SWF
a. Yield estimations if SWF acquire TBs and IRs over Time
The SWF can play a big role in domestic debt restructuring as an opportunity
exists for investment in treasury bills (TB’s) and internally registered stock
(IRS). Currently, the space is dominated by various commercial banks and other
private investors.
NB: As the government cannot buy its own TB’s, this can be encouraged by
only using revenue gains from SWF and not set up funds or government-
invested accounts. Additionally, the SWF can establish a fund to accommodate
locate private investors and provide them security to raise funds for buying more
TB’s locally. SWF can build the trust profile of the government to issue TB’s,
also it can establish a platform to seller TB’s to various individuals, SMEs, etc.
The objective is to attract more domestic investment.
Current Treasury Bills and Internal Registered Stock
The yields are encouraging more domestic investment, the estimated debt
shortage estimates the money the government demand to fulfill its domestic
debt. The current domestic debt government demand in 2020 is N$ 21 billion.
Thus, a N$ 1 billion debt contribution from the proposed SWF can cover 5% of
the domestic debt demand. The model is not straightforward as time is required
for SWF to become self-sustainable and not depend on Government funding,
as it cannot use government funding to acquire TB’s.
Using local funds for the debt minimizes various debt shocks and the SWF can
benefit from the high average yield of 5% to 7%. The gains are stable and also
avoids Namibia’s dependents on lenders that are likely to withdraw in situations
when Namibia faces rating agency downgrades.
Table 4: Current TB’s and average yield
Year
Domestic
Debt
(N$
million)
Current
Average
Yield %
Yield
Amount (N$
million)
Est.Debt
Shortfal
(N$
Million)
%
Contribution
(N$ million)
%
Yield
Amount (N$
million)
2019
63,715
7.3%
4,651
2020
75,832
5.2%
3,943
2021
96,967
5.2%
5,042
21,135
22%
1,056
5%
54
2022
112,822
5.2%
5,866
15,855
14%
1,585
10%
82
2023
124,195
5.2%
6,458
11,373
9%
1,705
15%
88
(Bank of Namibia, 2021)
23
The average debt yield estimate promises very stable returns. It is key to retain
such funds within the local economy and stimulate domestic economic growth
and expand the financial sector. As per the chart, domestic debt will grow to
approximately 124 billion Namibian dollars. The yield rate used below is kept
constant at 5.2% as a minimum benchmark but is expected to yield more returns
in future.
Chart 5: Domestic Debt Yield Analysis
(Namibia Statistics Agency, 2021)
The chart below depicts an increasing trend of domestic debt and the potential
shortfall gap for domestic debt, thus there is more room for other financial sector
players to participate in TB and IRS acquisition domestically. This amount is
growing with a government demand for liquidity to fill budget deficits and
expenditure gaps.
Chart 6: Domestic Debt Future Estimate and Shortfall
(Namibia Statistics Agency, 2021) (Bank of Namibia, 2021)
63,715
75,832
96,967
112,822
124,195
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2019 2020 2021 2022 2023
Domestic Debt Yield
Domestic Debt (N$ - MLN) Av Yield
7%
5% 5% 5% 5%
22%
14%
9%
63,715
75,832
96,967
112,822
124,195
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
0%
5%
10%
15%
20%
25%
2019 2020 2021 2022 2023
Domestic Debt Yield
Av Yield Shortfal Debt (N$-MLN)
24
4. Namibia’s Investment Position
In this section, we analyze Namibia’s investment assets and liabilities to identify
possible investment opportunities for domestic and foreign assets. Various
countries utilize SWFs to strengthen their domestic and foreign asset base for
stability. This remains an important motivation to boost investment and asset
growth through various interventions. Namibia does not attract a lot of Foreign
Direct Investment (FDI) and needs to strengthen its position. As per the chart
below Namibia’s FDI position is trailing below that of Botswana as a regional
benchmark.
Chart 7: Namibia versus Botswana Foreign Direct Investment
(Trading Economics, 2021)
Net Investment IncomeCredit versus Debits
The chart below demonstrates Namibia’s investment income from 2015 to 2020,
obtained from Direct Investment, Portfolio Investment, other Investments and
Reserve Assets.
According to (Investopedia, 2021), the balance of payment (BOP), are
transactions recorded between two countries, a credit is when money enters a
host country, a debit is when money leaves the host country.
According to IMF (BPM) Portfolio investment is defined as cross-border
transactions and positions that involve debt or equity securities, other than those
in direct investment or reserve assets. (Pg. 110)
25
Chart 8: Investment income Chart 9: Portfolio Investments
Chart 10: Domestic Debt Future Estimate
Namibia encountered a low credit position for direct, portfolio and other
investments over the few years. This reflects a negative net investment (credit
debit) over the same period. The investment debit recorded in 2020 was N$ 6.4
billion and credit of N$ 3,6 billion respectively. The lowest net investment
balance was N$ 6.5 billion in 2018. The negative net investment situation is
exacerbated largely by direct investment and portfolio investment where
Namibia maintains a poor asset base in comparison to foreign investors. The
debit value in 2020 for direct investment in dividends was N$ 3,3 billion,
compared to Namibia’s credit position of N$ 6 million only. It is important for
Namibia to strengthen its foreign investment income position and widen its
foreign investment portfolio through various innovative mechanisms.
0
2,000
4,000
6,000
8,000
10,000
12,000
2015 2016 2017 2018 2019 2020
Investment Income - N$ million
Credit Debit
-
500
1,000
1,500
2,000
2,500
2015 2016 2017 2018 2019 2020
Portfolio Investments
Credit Dividents Credit Interest
Debit Dividents Debit Interest
158
(3,713) (4,075)
(6,562)
(4,330)
(2,795)
(7,000)
(6,000)
(5,000)
(4,000)
(3,000)
(2,000)
(1,000)
-
1,000
2015 2016 2017 2018 2019 2020
Net Investment - N$ mill
26
Foreign Direct Investments Assets and Liabilities
Chart 11: Direct Inv (Assets vs Liabilities) Chart 12: Portfolio Inv. (Assets vs Liabilities)
Chart 13: Investment Income
Direct Investments are transactions between governments while portfolio
investments are transactions between banks.
3
Direct Investments are assets
3
https://www.docsity.com/en/answers/difference-between-direct-investment-portfolio-
investment/155324/
1,317
-70 -874
1,303
132 826
11,439
5,230
3,727
2,760
-2,585
-1,228
-3,000
-1,000
1,000
3,000
5,000
7,000
9,000
11,000
2015 2016 2017 2018 2019 2020
Direct Investments Assets vs
Liabilities
Assets Liabilities
-2,551
452
5,547
2,787
1,697
-3,933
11,976
1,645
-621 -255 -113
-1,587
-4,000
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
2015 2016 2017 2018 2019 2020
Portfolio Investments Assets vs
Liabilities
Net acquisition of financial assets
Net incurrence of liabilities
-
5,000
10,000
15,000
20,000
25,000
Direct Invesstment
Portfolio Investment
Other Investment
Reserve Assets
Direct Invesstment
Portfolio Investment
Other Investment
Credit Credit Credit Credit Debit Debit Debit
Investment Income (2015 - 2020)
2015 2016 2017 2018 2019 2020
27
controlled by households or firms while Portfolio Investments are held by
pension funds and other investment institutions. (IMF, 2009)
A direct investment relationship arises when an investor is resident in one
economy and makes an investment that gives control or significant level of
influence on the management of an enterprise that is based in another economy.
(IMF, 2009) (Pg 101)
FDI was high in 2015 at N$ 11,4 billion (chart11 & 12) by the issuance of debt
instruments and the net incurrence of government liabilities obtained to cover
for budget shortfalls. The lowest liabilities occurred in 2017, mainly due to
lower equity and fund shares at N$ -735 million, and debt instruments at N$ -
1,8 billion. Foreign Assets were N$ 1,3 billion in 2015 and 2018 and the lowest
of 132 million in 2019.
Namibia’s Portfolio Investments slumped to N$ -3,9 billion in 2020 because of
a drop in equity investments and fund shares, as well as a reduction in short-
term and long-term Debt securities.
Portfolio investment - The debit’s interests reached a peak of 2,3 billion in 2018
and 2019 respectively, however, debit dividends remain very low.
Chart 14: Balance of Payment aggregates. Chart 15: Domestic Debt Future Est.
In 2015, there was a high inflow of net portfolio investments (N$ -14 billion)
and direct investments (N$ -10 billion). The position shifted upwards in 2019
where outflows increased for both net portfolio investments (N$1.8 billion) and
direct investments (N$2.7 billion) (Chart 14). In 2020 net portfolio investments
-30,000
-25,000
-20,000
-15,000
-10,000
-5,000
0
5,000
10,000
2015 2016 2017 2018 2019 2020
Balance of payments aggregates (N$
million) (2015 -2020)
RESERVE ASSETS (Increase (+)/decrease (-))
NET OTHER INVESTMENT [inflow (-)/ Outflow (+)]
NET PORTFOLIO INVESTMENT [inflow (-)/ Outflow (+)]
NET DIRECT INVESTMENT [inflow (-)/ Outflow (+)]
123,819 120,341
143,213 143,336 147,331 154,796
128,026
132,094
150,103
168,694
161,755
155,774
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
2015 2016 2017 2018 2019 2020
International investment position -
N$ million (Assets vs Liabilities)
FOREIGN ASSETS FOREIGN LIABILITIES
28
dropped to N$ -2.3 billion, while direct investments remained at N$ 2 billion.
However, reserve assets were low at N$-10 billion in 2015 and increased
gradually towards 2020 at N$ 521 million.
Foreign assets were lower in 2015 accumulating N$ 123 billion, with the highest
value of N$ 155 billion recorded in 2020. Foreign liabilities accumulated in
2018 to N$ 168 billion.
By definition, reserve assets are external assets which are readily available and
controlled by monetary authorities to meet a country’s balance of payments
financing needs. They are used for intervention in exchange markets to affect
currency exchange rates, and other related purposes such as retaining confidence
in the currency value of an economy, and serving as a leverage for foreign
borrowing. (IMF, 2009)(Pg. 111)
29
5. Global Growth of Sovereign Wealth Fund Assets
Although there is no panacea for widespread poverty and inequality, SWFs are
improving the financial position of various host countries. As per PWC’s
analysis, the SWF’s in asset value was recorded to be growing at 9.4% percent
between (2007-2015) and 6.2% (2016-2020).
2020 Sovereign Investors (AuM in USD tn)
AuM = (Assets under Management)
CAGR – Growth fund of SWF assets
Source: (PWC, 2020) (Norrestad, 2021)
4
SWF demonstrates a strong trend of growth within the global financial sector in
comparison to hedge funds and it also forms a strong basis of investment for
asset management.
Africa states need to strengthen its SWF assets to make the economies very
competitive towards other developed economies and become self-sustainable
and lastly curb inequality and poverty through domestic investment.
4
https://www.statista.com/statistics/323928/global-assets-under-management/
9.4%
2007-2015
6.2%
2016-2020
Hedge Funds
3.8 Trillion U$
Sovereign Wealth
Funds
15.3 Trillion U$
Global Asssssets
Under
Management
74 Trillion
30
6. SWF – an Enabler for Sustainable Development
The sovereign wealth fund can be used as an enabler for implementing
development projects. The 2019 UN Sustainable Development Report monitors
the progress on the implementation of development goals in Namibia. There are
very few references towards the requirement for funding, whilst funding is
needed to kick-start such development projects.
The report further states that The main setback threatening other development
areas is the overall economic situation in the country. After steady growth of 3
to 4 percent between 2010 and 2015, the country finds itself in an economic
recession in the last two years. This general economic downturn is expected to
trickle down to many other SDGs indicators of the Agenda 2030. Unfortunately,
as many of these indicators don’t have updated measurements since 2015, the
full extent of this expected impact cannot yet be assessed.” (NSA, 2019) (pg
35)
In essence, if the economy is not growing, then there is no actual growth to back
any claim or reports on welfare, various growth indicators within the SDG will
solely rely on economic expansion.
Some selected SDG goals will only be determined by economic and financial
stability within the given period, these goals are; poverty or hunger alleviation,
improved healthcare, quality education, clean water and sanitation, clean
energy, economic growth, industry growth, innovation and infrastructure,
reduced inequality, production and partnerships.
The UN SDG goals are strongly dependent on the implementation of domestic
development, infrastructure and other development initiatives.
In 2012, the Ministry of Industrialization, Trade and SME Development
established the “Growth at Home Policyto drive industrialization in Namibia,
however, this can only gain traction with financial support or the injection of
investment funds within the economy, otherwise it remains an industrialization
white-paper.
The Public-Private Partnership ACT 2017 (PPP) was implemented to drive
cooperation between the Government and the Private Sector, a segment of such
project implementation requires financial partners and investments, without
31
local financial investment options the dominant global players are likely to take
advantage of such situations for their sole interest. (GRN, 14 July 2017)
According to the Act, a proposal will be made for sourcing financial offers that
don’t pose a high risk toward public entities. In its definition, the Act (part 1(a))
states that the public institutions financial commitments will be budgeted for.
Contingent liabilities or guarantees will be assessed by the government to asses
if its feasibility.
The position of having highly bureaucratic processes over PPP projects will
likely offset investor interest and prolong negotiations for new ventures, thus an
SWF is in a better position to secure government equities and ownership. The
budgetary reliance on the Government for each individual investment will drag
projects even longer unless there is a reliable fund reserved under an
independent body, established as a source for investment funds.
The Namibia Investment Promotion and Development Board (NIPDB) was
established in 2019 with the objective to promote and facilitate investment for
economic development.
5
However, investment companies require the
government to provide incentives and at times financial guarantees to split the
investment risk and for government support towards their investment projects.
Namibia needs financial reserves to invest or partner towards local investment
projects, without offering only lip service.
5
https://nipdb.com/
32
7. The Correlation Between FDI and Inequality
Despite increasing investments in developing economies, poverty and income
inequality persist and remains a major challenge. The relationship between
Foreign Direct Investment (FDI) and income inequality is often divided into the
Neoclassical and Dependency Theories. The former optimistically argues that
FDI stimulates higher economic growth and, hence, lower inequality. The latter
states that FDI has negative effects on economic growth and leads to higher
income inequality (Firebaugh and Beck, 1994). Not many studies exist that have
empirically established a link between FDI and inequality (Basu and Guariglia,
2007; Tsai, 1995; Wu and Hsu, 2012).
The relationship between FDI and income inequality research revealed the
interesting finding that FDI leads to an increase in income inequality in host
countries but, when controlled for other local factors such as absorptive
capacity, human capital, the level of technology and the quality of institutions,
FDI reduces income inequality. This clearly demonstrates that the impact of FDI
on host counties is determined by their local conditions. In addition, if a country
increases its human capital levels (measured by proxy of tertiary education), it
can be expected
that income inequality will decrease. This makes sense because as more people
benefit from higher education, more likely will have access better jto obs and
incomes, stimulate economic spill overs and subsequently decrease inequality.
(Rupinder Kaur, 2018)
Education improves both urban productivity and the capacity to innovate which,
in turn, delivers higher growth. Therefore, the level of education not only
improves incomes of individuals but also has a long-term effect on the local
economy.
The findings also indicate that a higher level of technology and innovation
although with a lesser degree of significance) is likely to spur income inequality,
because advanced technology tends to replace workers and reduce employment.
However, although insignificant in this model, an interaction between total FDI
and local technology would reduce income inequality (seen by the negative
sign) through knowledge transfer. Furthermore, the interaction between FDI and
technology reveals stronger results in the case of different sectors of FDI.
(Rupinder Kaur, 2018)
High-tech FDI and inequality Interaction between hi-tech FDI and a country’s
absorptive capacity is important because increased absorptive capacity enables
33
a wider distribution of foreign investments and technologies in local economies
(creating more diversification) and can lead to a more equal society. In Africa,
internet and mobile data play important roles in the diffusion of knowledge to
small businesses, including informal markets. For instance, ICT and mobile
phone ownership enable access to business networks and education, financial
services and real-time market information. (Rupinder Kaur, 2018)
Impact of and FDI towards Resources and Inequality
In Africa, the resources sector is the second-largest recipient of FDI, accounting
for 34% of total FDI.
According to a study by Kaur (2018),in African countries the relationship
between FDI towards resources and income inequality is not significant, as such
FDI has proven to have a negative impact on the per capita gross national
income (GNI). It is estimated that such FDI generates two (2) direct jobs per
USD million of FDI, compared to five or six jobs per million in the hi-tech and
manufacturing sectors in a different country. The FDI towards the resources
sector in Africa is extractive and mostly associated with the exports of raw
material rather than local value addition. African countries only receive a short
end of the stick while suffering environmental impacts and have poorer road
conditions because of such activities. The findings show that an increase in
human capital improves the skills of workers that are in the services sector.
However, the interaction between services FDI and tertiary education tends to
increase income inequality because the services sector will require skilled and
qualified workers of which most African countries do not have, thereby
generating only two direct jobs per USD million of FDI. (pgs 138-139)
(Rupinder Kaur, 2018)
Zimbabwe as one of the most unequal countries in Africa has shown the largest
decline in income inequality due to FDI, preceded by Namibia. (pg 132)
(Rupinder Kaur, 2018)
According to the report by the PWC (2020), The economic rebalancing carried
out most countries affects the geographical asset allocation by Sovereign
Investors. It was predicted that by 2020, countries in South America, Africa,
Asia and the Middle East (SAAAME) will account for a larger percentage of
Sovereign Investors’ assets as well as entities. Sub-Saharan Africa is expected
to demonstrate significant growth in terms of SWF investments, however more
optimism is needed to boost such assets. Tremendous growth is expected for this
34
region in coming five years and total assets are expected to will remain
comparatively modest. Additionally, the CAGR of SWF investor assets are
expected to increase globally and African investor assets are expected to expand
by 11.4%. (PWC, 2020)(page 10)
35
8. SWF as a Tool for Economic Stabilization
Advance economics required funds to protect monetary and fiscal volatility and
avert shocks during hostile economic slumps and recessions. Namibia’s
prevailing drought situation reverberates shocks throughout various sectors at
an alarming rate. Drought affects raw material inputs and intermediary products,
this increases overall production costs. Those dependent on Agricultural goods
are directly affected by deaths of livestock, food shortages and slow crop yields.
In such shaky conditions, additional funds are useful in maintaining the
economy’s overall fiscal balance through stabilization.
Namibia’s economy is dependent on the output levels of minerals and
commodities, these are mainly uranium, gold, copper, zinc and other
commodities. Revenue from natural resources often accrue large amounts but
are volatile to the cost of production inputs, which are unpredictable in most
cases. Given the unpredictable pattern of commodity prices, other fluctuations
may also appear frequently, these variations can remain for some longer periods.
Such discovery of resources can lead to a destabilizing effect on the budget
cycle, thus creating disproportionate and inefficient expenditure during resource
booms and budget deficits during busts. (Markowitz, 2020)
According to Markowitz (2020), there is no specific fiscal rule to fit all
countries, however, creating or enforcing fiscal rules with fewer loopholes is
important for stabilization funds to operate effectively. Fiscal stabilization funds
create a support mechanism towards counterproductive fiscal policies to protect
resource revenues when tougher conditions prevail.
The enforcement of regulations ensure accountability and to ensures that the
economy is protected from severe fiscal shocks and instability.
Political instability and interference pose a serious threat to stabilization funds
and resource revenues when tougher conditions prevail, thus it is important to
usher in supportive SWFs to protect the economy. (Markowitz, 2020)
36
9. The Current Structure of Investment Funding in Namibia
The section focuses on the size of domestic funding provided by various major
financing institutions in Namibia such as banking institutions, pension funds and
other equity financiers.
The results were taken from all the major financiers in Namibia for the period
of 2017 to 2020. The overall funds recorded from this institution was N$ 209
billion in 2020, an amount of N$ 223 billion was recorded for 2019. This
includes lending for private, commercial and non-commercial loans signifying
a diverse demand for loans. Private loans are also included in a feasible space
within the funding sector, as such loans generate revenue for the financing
institutions and are not for free.
The aim of the SWF is to promote equitable wealth in the economy and to take
reduce pressure or complement commercial enterprises loan commitments,
additionally, it demonstrates a need for liquidity for improving livelihoods of
civilians and also business funding.
If the respective commercial enterprises are foreign-owned, the funding interest
will only benefit foreign entities and not develop the local economy sufficiently.
Chart 16: Namibia’s overall funding position Chart 17: Funding composition GIPF vs
Banks
Sources: Annual Reports (FNB, NEDBANK, STANDARD BANK, AGRIBANK, DBN,
GIPF)
207,313
222,851 223,685
209,387
195,000
200,000
205,000
210,000
215,000
220,000
225,000
2017 2018 2019 2020
Namibia's Aggregate Funding Capacity (N$
mill)
98,836
105,330
113,241
110,310
108,477
117,521
110,444
99,077
95,000
100,000
105,000
110,000
115,000
120,000
2017 2018 2019 2020
Bank Funding Vs GIPF (N$ Mill)
Banking Sector Funding
GIPF - Total Investments (DI & Portfolio)
37
The Government Institution Pension Fund (GIPF) is a major source of local
funding and financial reserves. Their total investment value was N$ 117 billion
in 2018, higher than all commercial bank aggregate of N$ 105 billion for the
same year. In 2019 commercial bank funding peaked to N$ 113 billion, this
reduced to N$ 110 billion in 2020, whilst GIPF dropped N$ 99 billion during
the same period as a result of the Covid-19 pandemic. This also indicates that
the pandemic led to a N$ 14 billion dollar (6%) shortfall in funding or
investment in the year 2020.
The GIPF makes up 64% of Namibia’s funding aggregate, of which N$ 90
billion is an investment in Portfolio and direct investment and N$ 108 billion is
managed by fund managers (2020).
Within the local commercial bank space, Bank Windhoek makes 30% of the
total local funding, followed by FNB at 28%, Standard bank at 23%, Nedbank
at 11% and the DBN at 8%. (The Agribank’s results was not available for the
same period).
Chart 18: Namibia’s funding composition Chart 19: Commercial
Source: Annual Reports (FNB, NEDBANK, STANDARD BANK, AGRIBANK, DBN,
GIPF)
Some banks have a flatter curve when lending by keeping their funds within the
same range, such as Nedbank, Agribank and Development bank, with slight
increases.
Bank Windhoek, Standard Bank and FNB demonstrated a steeper upward rise
in funding.
GIPF -Total
Investments (DI &
Portfolio)
35%
GIPF -Total Investments
by Inv Managers
29%
Bank Windhoek
11%
FNB -Namibia
10%
Standard Bank
8%
NedBank
4%
Development Bank
3%
Banking Sector Funding (N$million) -2020
28,709
25,776
20,059
11,843
7,818
Bank Windhoek
FNB -Namibia
Standard Bank
NedBank
Development Bank
Agribank
Banking Sector Financing (N$million -2020)
38
Chart 20: Trend of local funding (2017 – 2020)
Source: Annual Reports (FNB, NEDBANK, STANDARD BANK, AGRIBANK, DBN,
GIPF)
The annual percentage change of Standard Bank grew by 20% in 2019 and
Agribank by 15%. The highest shift for DBN was 13% in 2018, followed by
FNB’s 10% rise the same year. The aggregate funding position demonstrates
annual growth for the 2017-2020 period at approximately 7% in 2018, 8% in
2019 and a drop of -3% in 2020 for all the banking sector.
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2017 2018 2019 2020
Banking Sector Financing (N$million)
Bank Windhoek FNB - Namibia
Standard Bank NedBank
Development Bank Agribank
39
10. Funding Sources for a SWF
According to Estevez (2020) investment strategies of SWF’s differ from country
to country and the main sources of SSWF funding are:
State-Owned Natural Resource Revenues
Trade Surplus
Bank Reserves
Foreign Currency Operations
Money from Privatizations
Government Transfer payments (Estevez, 2020)
Stock Markets
The main sources of Government revenue are natural resources, however, the
government retains a low percentage of equity ownership in most mineral mines
whereby they only collect a small amount of royalties annually. The sketchy
relationship with mines and minerals is always under public scrutiny and media
criticism as the government has liberated the operation of most mines. The push
for nationalization, value addition and localization are also criticizing as a means
of enriching few individuals and suspicion of non-transparent exploitation of
such mineral ownership. Investors also remain skeptical against the forceful
transfer of ownership while they have made investments in the mining
companies. A fairly structured and more reliable solution is an SWF ownership
of strategic local resources into the mines without compromising standard and
normal business environment. The government can then appoint people with
skills in those specific sectors to acquire revenue for the SWF in those respective
sectors and represent the interest of the government to obtain more.
Subsequently also to ensure re-investment in these sectors without diverting the
funds elsewhere, while building local capacity in these respective sectors. If the
benefits of having an SWF as an equity partner, then most companies will
consider this as a strategic partner for long-term investment. The scenario of
SWF involvement should not be imposed in an uncompetitive manner and thus
should not favor one company above another under the disguise of government
protection. Sectoral regulatory frameworks should oversee and impose fair
industry standards. In most cases, the mines operate in spaces where adverse
competition is low with monopolistic tendencies.
40
Namibia does not document a high score of revenue from on bank reserves,
foreign currency operations, however the SWF can assist the country to build
more sources of revenue.
The chart below was drafted by Price Westerhouse Coopers and demonstrates
the structure of various sovereign wealth funds. It highlights the various
checkpoints on funding, objectives, mandate, ownership, investment focus and
sectors, domestic and foreign focus, etc.
Source: (PWC, 2020)
Source of Funding
Entity Status
Objective
Mandate
Invesstment Portfolio
Commodities
Central Bank Account
Capital Maximization
Domestic
Asssets, Equities, Fixed
Income, Money Markets
Non-Commodity
Independent Entity
Economic Development
Internation
Energy, Infrastructure, Real
Estate, Hedge Funds
41
11. Targeted Investment and Sectors
Investment is very diverse and each economy has different interests however
the core target segments are a domestic, regional and international investment.
The domestic investment sectors include goods, services as well as development
projects. Namibia’s goods and services were outlined earlier as per the GDP
sectorial analysis.
The priority development projects in Namibia that require support can be
summarized as:
1. Energy sector Infrastructure (Wind, Hydro, solar energy, Power
Generation and Distribution, acquisitions of existing energy projects,
innovation, manufacturing of energy-efficient products).
2. Infrastructure Development (road, rail, port, transport and logistics,
storage, warehousing, dams, etc.)
3. Agricultural Development (irrigation projects, equipment, information
systems, feedlots, etc.)
4. Industrial Development (SME parks, food packaging facilities, food
processing, manufacturing, raw materials, value addition and
beneficiation, etc.)
5. Technological Development
6. Land and Property Development in urban and rural areas.
7. Water Infrastructure (Rural and urban water infrastructure, distribution
and storage)
The Namibian government does not earn enough revenue to implement all
development projects under its development budget, this leads to high reliance
on foreign funding and concessional loans.
According to (Javier Capapé, 2019) the 5 main target sectors are technology
with a 31.4% investment composition, Life Sciences 13.4%, Real Estate 15.9%,
Services 7.6% and Infrastructure 11.2%.
6
SWF’s are also the main contributors
to Venture Capital firms by investing 5,4 billion US$ in 2019 and 31 billion US$
in 2018. (Javier Capapé, 2019)
6
Source: Sovereign Wealth Research (IE Center for the Governance of Change) and SovereigNET (Fletcher
School, Tufts University). The 2019 data for the nine-month period Jan to Sep.
42
SWF performance by “deal-making”, states that the commitment is motivated
by engaging in acting enterprise, commercial and venture deals to encourage the
growth of the fund. Various other government institutions rely on wider
mandates but lack quantitative goals. The Tamasek SWF of Singapore is very
active in deal-making although not the largest, in 2019 they executed 82 deals,
followed by GIC (Singapore) fund with 58 deals, Mubadala (UAE) with 19
deals, Abu Dhabi Investment Agency with 15 deals. (Javier Capapé, 2019) This
demonstrates the proactive role by a small country such as Singapore to expand
its investment footprint among dominant global players.
The top industries in terms of deal count are listed below (Javier Capapé, 2019)
There are currently 94 SWF’s globally with major players in Norway (1 trillion),
China (1.3 trillion), UAE ( 745 billion), Hongkong China (529 bln), Kuwait (527
bln), Saudi Arabia (512 bln), Singapore (407 bln) and Qatar (2005). (Javier
Capapé, 2019)
The economies with an SWF are have demonstrated growth and stability and
secured their position in the shifting global markets.
Biotech
29,
10%
Softwar
e
22,
22%
Fintech
22,
7%
Data
15,
15%
Logistics
/Wareh
ouse 14,
6%
Mobility
13,
5%
Office
13,
4%
E-
commer
ce 12,
4%
Food/Be
v 11,
3%
Healthc
are 10,
3%
43
12. Convergence of Technology and Investment in Africa
The Tale of the City Boy and Farm Boy
A farmer lived in a secluded village with his two sons. One of his sons grew up
to be a farmer tending livestock and cultivating crops that he sold in the nearby
markets. The other son migrated to the village and worked for an investment
company, and he acquired a broader knowledge of economics, investment, and
trade compared to his brother that resided on the farm.
After few years of integrating into the city life and the other one adopting on the
farm, the father convinced them to switch their roles and his son in the city
moved back to the farm, the one on the farm moved to the city.
The city life became very expensive for the village son who had to pay rent, dine
at restaurants, expensive clothes, modern furniture, fuel expenses, water and
electricity expenses, insurance and for his house cleaner’s salary.
For the son that grew up in the city, returning to the farm was cheaper to adopt
as he was only required to lower his standard of living and expenses.
They each had a divergent view of the economic environment they were
accustomed to. The farm son perceived economics, development and trade from
a narrow context of farming, selling, agriculture, etc. The city boy had a broader
perception of the economy.
In Africa, people are more concerned about how economic theories address their
rural and urban survival. Investment is one of the most important elements that
is required to build a bridge between the village, the farm and the city/cities. For
a common person living in Africa, there is little exposure to the concept of
development, albeit a fanatical expectation that investment determines a
person’s destiny. In developed countries, investment is perceived as an abstract
sector of the economy like any other sector, which has to develop and grow
itself. This framework is supported by their inherent efforts and commitment
towards hard work, education, skills, training, ethics, cooperation, integrity and
patience for the benefit or strengthening the role of investment instruments in
their domestic economy before reaching out to other countries successfully. The
architects that are shaping the investment highway must be equipped enough to
carry out robust planning and implementation strategically, else the gap between
a developed and underdeveloped segment of the economy will remain wider.
The second most important instrument of connecting the village and the city is
technology, there is a symbiotic relationship in Africa between investment and
technological advancement, the need for basic technology is a cross-cutting
44
important factor for education, health, businesses, agri-industry, mining,
transport and manufacturing.
The connection is that farms feed the inhabitants of any city whereby the city
creates solutions for the farm and rural existence. The convergence in the two
related sectors paves the way toward digital transformation in Africa. The world
has finite needs, for an infinite number of people, but the digital instruments will
assist Africa’s economic assessment to measure the desired level of
employment, productivity and the type of services required to bridge the
inequality gap. Ideas are required to foster digital development, but the
investment is also required to turn those ideas into reality, however domestic
and foreign investment is not an idea, but an existing concept that must be
enforced without delay to eliminate barriers that hamper Africa’s innovative
ideas. We exist in a world that has overcome the link between high productivity
and profitability, the tech industry continues to prevail stronger breakthroughs
by accumulating more gains by sweating less.
The current investment in digital and tech innovation sets the potential for future
development and transformation in government services, state-owned
enterprises, infrastructure, trade and investment, services education, health.
45
13. SWF and Foreign Reserves
Namibia has a low position for Current Account (primary income) reserves
ranging from N$318 million in 2015 to 547N$ in 2020, there is a variation in its
size but the highest value was N$ 834 million in 2019. Primary income account
presents primary income flows between resident and non-resident institutions,
which captures returns for labor, dividends, investment income, financial assets,
renting of natural resources, etc. (IMF, 2009)
The Financial Account reserves accumulated a value of N$ 10 billion in 2015,
with a decline of N$ 3 billion in 2019 and bounced back to N$ 521 million in
2020. According to (IMF, 2009) financial account shows the net acquisition and
disposal of financial assets and liabilities. Even if the Reserve assets were high
for the same period, the net financial account retains a negative value which was
N$-17 billion (2015), N$ -18 bln (2016), N$ -214 mln in 2019, with a positive
value in 2020 (N$ 2 bln). The negative values indicate there was a net inflow of
foreign direct investment and in 2020 there was an outflow.
Acquiring foreign assets is not really an accumulation of reserve assets for the
country’s balance of payments but rather a diversification of the economy’s
wealth stock. (IMF, 2009)
Chart 21: Namibia’s Reserve assets (2017 – 2020)
The current account is for that specific period under review whereas the
financial account impacts future accumulation. The SWF is established using
foreign reserves or portfolio investments held in other countries by Namibian
institutions in a way to encourage domestic investment promotion.
-4,000
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
2015 2016 2017 2018 2019 2020
Reserve assets (N$ million)
Credit (Primary Income) Financial Account
46
The current laws in place which favours domestic investment is the withholding
tax rate of 10% for foreign entities
7
(Namibia Income Tax Act 24, 1981) and
the 35% domestic investment requirement derived from Regulation 28 of the
Pension Funds Act (24 of 1956)
8
. The SWF can become a tool for encouraging
investment by the GIPF and also ass equity partner for those companies willing
to reinvest their retention funds.
7
https://www.namra.org.na/tax-types/page/withholding-tax-30120/
8
https://www.gipf.com.na/unlisted-investments
47
14. Summary
SWF is not perceived as a panacea that would heal years of poverty and
economic disparities, the subject requires further impact assessment to analyze
its effectiveness to resolve the current problems. There are various possibilities
when countries embark to implement development funds, but for a country not
to have any at all signals a serious lack of cautionary or financial progressive
instruments.
The concept of the sovereignty of wealthis to contain the outflow of money
and ensure it remains within the sovereign state.
The research aims to encourage more conversations and debate about
establishing an SWF in Namibia, as an instrument to boost investment and draw
participation from key decision-makers and various stakeholders in the
economic policy and development policy fora.
Africa is a fertile ground for innovation and investments, in Namibia there are
funds available from various sources such as pension funds, unlisted funds,
development finance institutions, commercial banks, etc. The current sources
prefer investing in more structured companies and this excludes new players
such as SMEs and start-ups.
Most businesses die out in the incubation stages of their business and ideas and
do not accumulate enough taxable revenue. The GDP expansionary challenges
of the GDP will remain until more diversified funds are introduced to stimulate
growth in the micro and midi segment of the economy via empowerment funds
and an SWF.
Namibia is in a commendable position with a favorable legislative environment
and has a good perception of transparency to discover more investment
mechanisms for which an SWF is suitable.
Infrastructure development requires a stable domestic investment climate in
strategic sectors such as energy, water infrastructure, rail and road
infrastructure, agricultural production, etc as a stepping stone to boost domestic
and regional trade productivity. Due to various other exogenous factors,
Namibia requires unconventional investments with foresight to support its long-
term goals and fiscal stability. Existing and novel investment funds can be
structured for seasonal products and lump repayment, such funds will facilitate
growth in the agricultural sector.
48
To achieve the SDGs countries should identify potential in the agro-industrial
sector, smart cities, energy and health. SWFs are market-oriented government-
controlled funds that play a key role of combining private investment in the
development of the Namibia. In 2018 and 2019 alone, SWFs invested in
sustainability-linked assets with a total value close to 16 billion dollars. (Javier
Capapé, 2019) (pg. 9)
The achievement of the UN’s SDGs need enormous investment from both the
public and private role players. The SDGs are very ambitious and require a lot
of resources to achieve especially for emerging economies, linking of deals and
investors is tantamount. The United Nations Conference on Trade and
Development (UNCTAD) estimated an annual investment deficit of $2.5 trillion
in the main sustainable development sectors in emerging countries alone.
Trillions of dollars in assets under management by SWFs and other sovereign
funds, government investment vehicles will play a fundamental role towards
such projects. The connecting of SWF capital with various projects have proven
to be a challenge, not because projects are lacking or capital is lacking, but
because of a lack of profitable, viable projects. (Javier Capapé, 2019)(pg 70)
According to the PWC, Global Sovereign investors’ assets grew in the past
decade reaching USD 10.6 tn in 2014. While the future looks bright for many
SWFs, estimated future developments forecasts depicts a slower growth
prediction in the coming years, due to recent events such as the drop of oil prices
and the slowdown of economies like China. (PWC, 2020) Pg 7 Hence these
prospects depend from country to country.
Sovereign Investors are disproportionately represented in emerging economies.
As global economic power continues to shift, Sovereign Investors will grow
faster than total global assets. (PWC, 2020)
49
15. Tables and Charts
a) Namibia’s Investment Income
N$ Million - Investment
Icnome
2015
2016
2017
2018
2019
2020
Credit
3,599
3,535
3,462
4,133
4,057
3,648
Debit
3,441
7,248
7,537
10,694
8,387
6,443
b) Namibia’s Net Investment (2015-2020)
2015
2016
2017
2018
2019
2020
Net Investment
158
(3,713)
(4,075)
(6,562)
(4,330)
(2,795)
c) Namibia’s Portfolio Investments (2015-2020)
Portfolio Investments
2015
2016
2017
2018
2019
2020
Credit
Dividents
2,078
1,812
1,656
2,038
1,908
1,481
Credit
Interest
972
974
796
909
959
1,391
Debit
Dividents
11
11
11
11
11
11
Debit
Interest
848
1,912
2,299
2,334
2,348
2,187
d) Breakdown of Namibia’s Investments (2015-2020)
2015
2016
2017
2018
2019
2020
Credit
Direct Invesstment
24
80
120
(24)
(19)
11
Credit
Portfolio
Investment
3,049
2,786
2,452
2,947
2,867
2,872
Credit
Other Investment
208
253
262
436
376
217
Credit
Reserve Assets
318
417
629
774
834
547
Debit
Direct Invesstment
1,651
3,923
4,020
6,842
4,452
3,302
Debit
Portfolio
Investment
859
1,923
2,310
2,345
2,359
2,198
Debit
Other Investment
930
1,403
1,208
1,508
1,576
942
e) Namibia’s Balance of payments aggregates (N$ million)
2015
2016
2017
2018
2019
2020
NET DIRECT INVESTMENT [inflow (-)/
Outflow (+)]
-
10,122
-5,300
-4,601
-
1,457
2,717
2,054
NET PORTFOLIO INVESTMENT [inflow
(-)/ Outflow (+)]
-
14,528
-1,193
6,168
3,041
1,810
-
2,346
NET OTHER INVESTMENT [inflow (-)/
Outflow (+)]
-2,438
-
14,598
-
10,454
-
6,383
-1,713
1,785
RESERVE ASSETS (Increase (+)/decrease
(-))
10,013
1,959
4,965
1,020
-3,169
521
50
f) Banking Sector Financing (N$ million)
2017
2018
2019
2020
Bank Windhoek
28,709
29,763
31,290
32,691
FNB - Namibia
25,776
28,259
30,298
29,994
Standard Bank
20,059
21,842
26,262
24,931
NedBank
11,843
12,203
12,071
12,209
Development Bank
7,818
8,818
8,507
8,465
Agribank
2,614
2,427
2,794
Total
98,836
105,330
113,241
110,310
g) GIPF Funding (N$ million) – Part 1
2017
2018
2019
2020
GIPF - Private
89,174
96,714
104,436
90,532
GIPF - Total Investments (DI &
Portfolio)
99,077
110,444
117,521
108,477
Total
188,251
207,158
221,957
199,009
h) GIPF Funding (N$ million) – Part 2
2017
2018
2019
2020
GIPF - Total Investments by Inv
Managers
89,174
96,714
104,436
90,532
GIPF - Total Investments (DI &
Portfolio)
99,077
110,444
117,521
108,477
Total
188,251
207,158
221,957
199,009
i) Namibia’s Overall Funding Position (N$ million)
2020
GIPF - Total Investments (DI & Portfolio)
108477
GIPF - Total Investments by Inv Managers
90532
Bank Windhoek
32691
FNB - Namibia
29994
Standard Bank
24931
NedBank
12209
Development Bank
8465
Agribank
j) GIPF Funding versus Banking Funding (N$ million)
2017
2018
2019
2020
Banking Sector Funding
98,836
105,330
113,241
110,310
GIPF - Total Investments (DI &
Portfolio)
108,477
117,521
110,444
99,077
51
k) Namibia’s Total Funding Available (N$ million)
2017
2018
2019
2020
Namibia's Aggregate Funding Capacity
(N$ mill)
207,313
222,851
223,685
209,387
l) Namibia’s Funding Annual Change (%) (2018 – 2020)
2018
2019
2020
Bank Windhoek
4%
5%
4%
FNB - Namibia
10%
7%
-1%
Standard Bank
9%
20%
-5%
NedBank
3%
-1%
1%
Development Bank
13%
-4%
0%
Agribank
-7%
15%
Total
7%
8%
-3%
m) Reserve Assets (N$ million)
2015
2016
2017
2018
2019
2020
Credit (Primary Income)
318
417
629
774
834
547
Financial Account
10,013
1,959
4,965
1,020
-3,169
521
Foreing Assets
23,577
24,720
30,177
31,024
28,941
31,752
52
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ResearchGate has not been able to resolve any citations for this publication.
Article
Full-text available
Background: Namibia is an open economy where international trade accounts for a greater proportion of gross domestic product (GDP). Openness of the Namibian economy for the period 2010 to 2018 has been on average 111% of GDP. The high level of openness of the economy raised an important question on the relationship between export and economic growth in Namibia. Previous studies investigated the linear relationship between these two variables. The investigation was also done at an aggregate level. This raises important questions on whether the relationship between export and economic growth is asymmetric. It also raises an important question on whether this relationship is sector specific. Aim: In order to fill the gap in previous research, this study investigates the asymmetric or non-linear relationship between the main export sectors and economic growth in Namibia. A non-linear relationship between the two variables will indicate that negative and positive values of the explanatory variables have different effects on the dependent variable. This analysis is done for the main export sectors of the Namibian economy in order to ensure the policy recommendations are sector specific. Setting: Standard economic theoretical models on the relationship between export and economic growth are used to test the non-linear relationship between the two variables. The study covers the period 2010–2018 and focuses on the three main export sectors (diamonds, manufactured food and live animal products) and growth of the Namibian economy. Methods: This study uses non-linear autoregressive distributive lag in order to estimate the asymmetric relationship between the main export sectors and economic growth of Namibia. The estimation is done for the three main exporters of the Namibian economy. Results: The results indicate that there is a symmetric relationship between main export sectors and economic growth of the Namibian economy. The results show that an increase (positive values) in export of the three main export products will cause economic growth to improve. Negative values (decrease in export) will cause economic growth to deteriorate. Conclusion: The results suggest that estimating the non-linear relationship for different sectors of the economy (instead of estimating the relationship at aggregate level for total exports) will ensure that economic policies are sector-specific. The results further suggest that when exports are declining, expansionary policies will be the appropriate responses.
Article
Full-text available
The purpose of this study is to examine the empirical relationship between manufactured exports and economic growth in SADC. This study applied the recent panel econometric methods to determine the long run equilibrium between manufactured exports and economic growth. The results of this study indicate that there is an existence of long run equilibrium between manufactured export and economic growth during 1980 to 2012. The results show that there is a positive impact of manufactured exports on economic growth in SADC. Furthermore, the study applied causality analysis and it was found that causality is running from economic growth to manufactured exports.
Occasional Paper 304 -South African Institute of International Affairs (SAIIA
  • C Markowitz
Markowitz, C. (2020). Sovereign Wealth Funds in Africa: Taking Stock and Looking Forward. Occasional Paper 304 -South African Institute of International Affairs (SAIIA), 4-5.
National Equitable Economic Empowerment Biil. Windhoek: Government of the Republic of Namibia
  • Grn
GRN. (2015). National Equitable Economic Empowerment Biil. Windhoek: Government of the Republic of Namibia.
Sovereign Wealth Funds an Ethical Perspective
  • R C G Stuckelberger
Stuckelberger.C, R. G. (2016). Sovereign Wealth Funds an Ethical Perspective (No.15). Globethics.net.
Sovereign Wealth Funds 2019, Managing Continuity, Embracing Change
  • Javier Capapé
Javier Capapé, P. J. (2019). Sovereign Wealth Funds 2019, Managing Continuity, Embracing Change. IE Center for Governance and Change.
The Impact of FDI on Income Inequality in Africa, The State of African Cities
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Rupinder Kaur, R. W. (2018). The Impact of FDI on Income Inequality in Africa, The State of African Cities, Part B -Chapter 1.
Balance of Payment Data
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Norrestad, F. (2021, Feb 3). Statista.com. From https://www.statista.com/statistics/323928/global-assets-undermanagement/ Bank of Namibia. (2021). Balance of Payment Data.
NSA Data -National Accounts
Namibia Statistics Agency. (2021). NSA Data -National Accounts. Trading Economics. (2021). From https://tradingeconomics.com/namibia/foreign-direct-investment
Balance of Payments and International Investment Position Manual
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IMF. (2009). Balance of Payments and International Investment Position Manual. INTERNATIONAL MONETARY FUND. Sixth Edition (BPM6) International Monetary Fund.