The overall objective of this report is to review the revenue collected from the forestry sector (in the form of taxes, levies and fees) and the current financing of government forestry institutions. In other words, it examines:
1. how much money flows from the forestry sector to the government (i.e. in taxes and levies paid to government by the forestry sector); and
2. how much money flows back into the forestry sector from the government (i.e. in the form of government expenditure).
Namibia’s forest resources constitute an important national heritage, which provides both economic and environmental benefits. Forestry development in Namibia started at the beginning of the 20th century when the role of woody vegetation in environmental protection was recognised by the German colonial government. However, the forest resource suffered a great deal under the South African rule when uncontrolled cutting was encouraged, especially in the communal areas of the North and Northeast of the country. Indeed no meaningful development activity was initiated in the forestry sector during South African occupation.
The colonial policy of forest exploitation, especially in the communal areas and commercial areas of Tsumeb and Grootfontein, started in the 1930s and continued unabated until Namibia attained independence in 1990. A lack of technical capacity to administer forest concessions worsened the situation of uncontrolled forest exploitation. Meanwhile, poor forestry administration constrained the initiation of any meaningful forestry development activities. In the early 1970s and late 1980s, the country’s liberation struggle prevented the implementation of forestry development activities in large areas of Northern Namibia, which needed attention and still account for the bulk of the forest resource.
For many years, forestry development was managed from a small section within the Ministry of Agriculture. The Directorate of Forestry (DoF) was established at Namibia’s independence in 1990, to highlight the importance of forestry to national development and to carry out programmes that are aimed at implementing the national forest policy. The first post-independence forest policy was approved in 1992. One of the deficiencies of the 1992 forest policy was a lack of clarity with respect to: stakeholder participation in the decision-making process on forests; stakeholder participation in forest management programmes; and the impacts on forests of decisions and policies from outside the forestry sector. Therefore, in 1998, Namibia’s Forest Policy was reviewed. A new forest policy, that addresses the above-mentioned issues, has been prepared and is currently being formally approved.
At present, the DoF is still in its early developmental stages. The Directorate produced the first Forestry Strategic Plan for Namibia in 1996. The strategic plan outlines four programmes that need to be addressed: capacity building; environmental forestry; community forestry; and farm forestry. In August 1997, the Directorate started the Namibia-Finland Forestry Programme to implement the four programmes of the strategic plan. The strategic plan was based on ecological, environmental, cultural, and socio-economic considerations and it considered “production, protection and participation” as the three important issues of forestry development in Namibia. Namibia is still using old forestry legislation, for example the Forest Act of 1968 (Act No. 72 of 1968). New forest legislation was prepared in 1997 and is awaiting approval by parliament.
The main challenges faced by the Directorate are manpower development, infrastructure development and improvement of data and information for the planning and management of forest resources. However, several forestry staff are in colleges and universities to obtain Forestry Diplomas and BSc Degrees and infrastructure development is almost complete. Forestry data collection, compilation, analysis and dissemination are in progress, but need further support and strengthening to institutionalise the process. A process to develop criteria and indicators aimed at monitoring sustainable forest management in Namibia is also on-going and a few criteria and indicators have now been selected for actual testing in the field.
All relevant institutions were contacted and asked to provide information about forest revenue collection. However, some of them were reluctant to release fiscal data. For example, authorities such as the Ministry of Finance and other Directorates within the Ministry of Environment and Tourism were asked to provide this data, but they do not seem to have the information in a form that is readily and easily accessible to the public. In particular, the total revenue collected from wildlife permits issued for forest areas (which is an important source of government revenue related to forestry) were not unavailable.
Data on more general tax receipts (e.g. sales tax and/or VAT on forest products, income taxes and import duties) were also not available. However, it must be noted that these general tax receipts are not specific to the forestry sector and would usually be considered as falling outside the forest revenue system.
To summarise, at this stage, it is not easy to collect and compile this type of fiscal data for the forestry sector in Namibia, as statistics on forest revenue collection by some parts of the government are not readily available. This report does present the information that is available at the DoF, but it should be noted that this is only a part of the total forest revenue collected.