Finance minister Iipumbu Shiimi reaffirmed during yesterday’s 39th Covid-19 national briefing that economic recovery lies in Harambee Prosperity Plan (HPP) II.
“Namibia’s recovery plan lies in HPPII, as one of the goals outlined there is finding new engines of growth in the economy. Green hydrogen is one of the new areas of growth that Namibia is trying to pursue. It will not only contribute to the recovery, but also to the diversification of what we are already producing,” he stated.
Shiimi noted that the lesson learned from the pandemic is that countries which have successfully diversified and grew to a significant level are those that have targeted new areas of growth, and he believes green hydrogen will be the new energy of Namibia’s future.
Namibia’s economic performance is expected to improve in 2022, following the deepest contraction in the country’s history recorded during 2020.
According to the Economic Outlook Update for December 2021 from the Bank of Namibia, real gross domestic product (GDP) growth is projected to increase to 3.3% in 2022 from a deep contraction of 8.5% in 2020. These improvements are mainly on account of expected recoveries in the primary and tertiary industries.
Furthermore, Shiimi said measures that are in place to control the pandemic as outlined by the government are also part of plans to promote economic recovery.
“If we have Covid-19, it means people’s mobility will be constrained, productive capacity of the economy will be constrained and, therefore, we will not be able to recover,” explained the finance minister.
Shiimi added that President Hage Geingob also tasked his Cabinet to develop a diversification strategy, which was launched last year, in efforts to get the domestic economy kicking.
Last year, the finance minister said while unpacking the strategy that Namibia is at a desperate juncture in its economic development for the introduction of a diversification strategy as the country cannot rely indefinitely on its natural resources and volatile commodity prices for growth.
Under this strategy, Namibia has identified 97 products which the country can venture into. Government is now thus working with domestic and foreign direct investors to point out the areas where Namibia has potential.
“There is a need for coordination between the private sector and government to promote investment to scale up in potential areas. We already started piloting in December 2021 with a productivity task force, which is basically a dialogue between the private sector and investors operating in a particular sector. In this instance, we have started with high-value food products like grapes,” he indicated.
The task force, Shiimi said, will help with better coordination between the private sector and government to move in the same direction of diversification, growth and employment creation.