Africa-Press – Namibia. Investent inflows from China have declined by N$5.9 billion.
It currently stands at N$4.1 billion, from N$10 billion recorded before 2024.
This is according to a foreign direct investment (FDI) report by the Bank of Namibia (BoN) and the Namibia Investment Promotion and Development Board (NIPDB).
The main reason for this decrease is that Chinese foreign-owned mining companies in Namibia borrowed much less money from their parent companies compared to the previous year.
“Inflows from China remained among the top three, although declining largely due to lower uptake of intercompany debt by foreign-owned enterprises operating in the mining sector,” reads the report.
Namibia’s net FDI inflows were mainly from China, the Arab Gulf states, the United Kingdom and France between 2022 and 2024.
The majority of these investments were for oil and gas exploration and appraisal activity.
Additionally there was a net FDI inflow of N$4.1 billion from South Africa in 2023, from merger and acquisition transactions between entities in the manufacturing sector.
Other major source countries of FDI inflows were Canada and Mauritius.
“These are investments linked to mining activity, especially in the form of increased reinvestment of earnings by foreign direct investors,” notes the report.
Moreover, there was a recorded increase in the transport and storage sector during 2024.
This was from foreign investments associated with the concessioning of the Walvis Bay port.
BoN governer Johannes !Gawaxab says Namibia’s investments have come a long way since independence, with a decline experienced until 2020.
Between 1998 and 2008 Namibia attracted about N$25.7 billion in net FDI inflows.
“Much of it was in equity financing for projects in the manufacturing sector, including the Skorpion Zinc Refinery and diamond processing entities,” says !Gawaxab.
For 10 years between 2009 and 2018, FDI momentum remained strong with the country attracting net FDI inflows amounting to N$56.5 billion.
This was driven by greenfield investments in mining, particularly in uranium and gold.
Additionally, the strong economic performance between 2010 and 2015 boosted investor confidence, leading to increased foreign investment in the financial, and wholesale and retail trade sectors.
However, Namibia experienced a decline in investments between 2016 and 2020.
“Between 2016 and 2020, Namibia faced a period of economic difficulty, characterised by declining investment inflows and net outflows due to structural challenges and external shocks,” says !Gawaxab.
Namibia has experienced a strong rebound since 2021. From that year onward, cumulative net FDI inflows reached N$114.9 billion.
This number is expected to increase as private sector projects to the value of N$224.7 billion, facilitated by the NIPDB, are in the pipeline.
In 2024 alone, net FDI stood at N$37 billion.
Foreign-owned enterprises employed an estimated 62 817 people in 2023, up from 55 982 in 2019.
Additionally, foreign-owned enterprises accounted for approximately 11.5% of total employment, according to the 2023 Labour Force Survey.
Job creation was mainly driven by wholesale and retail, mining and quarrying, and financial services.
For More News And Analysis About Namibia Follow Africa-Press
