2 The Change Drivers

Namibia’s population today stands at an estimated 1.7 million people on an area of land measuring 830,000km²; making it one of the most sparsely populated countries in the African Continent. It is notable that Namibia’s population, which was 0.74 million people in 1970 grew at an annual rate of 3.1% to 1.03 million in 1981 and then at a slightly increased rate of 3.2% to produce 1.41 million people in 1991. It is expected to reach 2.0 million by the year 2005 and 2.25 million in 2010 and 2.63 million people by 2020. These projections have taken into consideration, the effects of HIV/AIDS and inter-regional migration.

The total fertility rate has decreased from 6.1 to 4.7 between 1991 and 1996. The initial high fertility rate was attributed to family reunions and repatriation of Namibian refugees after the war of liberation.

Infant mortality had also decreased from 67 to 58 per 1,000 live births between 1991 and 1996. This decline in infant mortality increased the life expectancy for females from 62.8 to 66 years in 1996 but for males it remained the same at 59 years during the same period. This has subsequently been adjusted downwards to 54 and 47 years for male and females respectively as a result of HIV/AIDS from now till 2020.

Internally population movements have occurred from rural to urban areas and between regions. In general, the rate of migration into urban areas is about 5 % per year based on 1996 estimates. Males constitute 52% of the migrants and at the same time it is the working ages of between 15 and 59 who migrate to urban areas and between regions. For example the region, which has received the highest inflow of migrants is Erongo Region, which carries the Fishing Coastal Town of Walvis Bay. The Khomas Region in which the capital city of Windhoek is located experienced a net migration of only 1.2%, a figure, which was influenced by out-migration to other regions.

Agriculture contributes only 10% of GDP but employs about 70% of rural women. In Namibia, scarcity of water is a major limiting factor to rural agriculture. Therefore the Continuation of unsustainable husbandry will harm land with increasing populations. This also means that it is imperative that improvements in natural resource management are made. In the forest sector, the population will have a bearing on energy supply, tree planting, localized scarcities of woof fuels, consumption patterns in industrial wood, availability of raw materials for the arts and crafts industry and the rate of conversion of forestry land to agriculture.

Since Independence in 1990, the new government has spelled out development objectives and targets for the country in an official document known as the National Development Plan Number 1 of Namibia (NDP1), which is now undergoing a mid-term review. This plan was meant to solve new development issues as the majority of Namibians who were formerly ignored and served mainly as semi-skilled and unskilled labour had to be brought into the mainstream of economic activities and the public service after independence. The political expectations of the formerly disenfranchised majority and the aspirations of the new leadership no doubt generated the following development goals at Independence:

Reviving and sustaining economic growth

Creating employment

Reducing inequalities in income distribution

Eradicating poverty

Considering the above challenging goals, the development objectives have been expectedly based on economic, social and political principles to realize them.

The economic aspects are aimed at the following objectives and activities:

To enhance and carry out a top-priority human resources development programme

Expanding the role of the private sector and foreign investment into the national economy

To maintain an inflation rate not exceeding her immediate trading partners

Liberalisation of exchange controls

Improving the status of food security

Diversification of import sources and export markets to expand trade with more countries and achieve competitive prices

Specifically promote productive sectors with potential for growth - fisheries, tourism, agriculture, mining and manufacturing.

Promote appropriate science and technology

To realize the social objectives of development, the government is committed to undertake to:

Reduce population growth rate, increase life expectancy and increase literacy to 80% by the year 2000.

Promote sport and culture

On the political front the new government aspires to:

Reduce regional imbalances in trade and access to natural resources

Support and encourage increased participation of women, youth and other marginalized groups in the economic development activities in the country

It is also important to note that the government espouses the principle of sustainable development which tacitly reflects an article in Namibia’s constitution which recognizes the need to maintain essential ecological processes and using Namibia’s natural resources sustainably for its economic development.

The recent and ongoing activities in government such as the promotion of export processing zones, policy for greater fiscal discipline in the civil service, rationalization and downsizing of the public service, promoting efficiency and effectiveness in government, all point to the fact that, the government intends to:

Maintain macroeconomic stability by strengthening monetary and public sector finance management and by consolidating fiscal discipline

Improve the efficiency of the public sector by accelerating and streamlining reform in the civil service and public enterprises, and improving the delivery of infra structural services

Enhance external and domestic competitiveness of the economy through further liberalisation of markets

Address the social aspects of development particularly through targeted poverty interventions and increased access of the poor to social services and income generating resources.

Namibia’s Economic Performance in the 1999-2000 Years

To depict the performance of Namibia’s economy, its primary, secondary and tertiary industries, are analysed quarterly and annually. The primary industries are so far dominated by mining, fishing and commercial agriculture. The commercial agriculture sub-sector was for a long time characterized by beef ranching and recently by a burgeoning and potentially lucrative commercial table grape farming. The secondary industries on the other hand, are made up of the meat and fish processing, other manufacturing, electricity and water supply and construction. The tertiary industries are driven by the wholesale and retail trades, tourism, financial, real estate and business services, transport and communication.

Taking 1999 as a base year and for which a full description on Namibia’s economic performance is available, one can begin to appreciate the country’s challenges in economic development and its possible areas of significant growth in the next five-year economic development phase after NDP1.

In 1999, Namibia’s economy improved on the previous two years and growth was estimated as 3%, which was better than the 2.4% and 2.6% figures for 1997 and 1998 respectively. Lower interest rates were associated with improvement of economic conditions. Despite favourable interest rates, consumer inflation remained at 8%. In addition to or in line with the low interest rates, the economy improved through the strong growth in value added in construction, tourism, agriculture and mining sectors, as well as increased government consumption expenditure. An interesting observation is that domestic demand is gradually increasing its importance alongside export growth in the growth of GDP and that it is predictably responsive to changes in interest rates.

Among the noteworthy changes, the construction industry registered an increase of 17.7 % over 1998 and tourist arrivals showed a 9% increase as well. Government consumption increased through personnel expenditure by 7% in 1999 compared to 3.9% in 1998. The agricultural sector improved by 5% over 1998 as a result of a 22% growth in the ostrich products industry and also the commercial table grape sub-sectors.

The indicators are based on analyses of various sectors between 1992 and 1999. It includes important elements such as exchange-rate fluctuations, growth in GDP, monetary and financial indicator, the external and public sectors. Table 2 (Source Bank of Namibia, 1999) contains all the available information. Some key indicators include a steady increase in population growth, 50% decrease in the value of the Namibian against the US dollar between 1992 and 1999, a worsening trade balance, an improving current account balance and increasing public debt as % of GDP.

Projected Economic Development in the second phase of economic planning (NDP2)

Namibia is currently preparing its second 5-year National Development Plan (NDP2). This plan will run from 2001 to 2005. A macro-economic forecasting done under the auspices of the National Planning Commission has projected three case scenarios. The first two assume minimum, maximum levels of economic growth respectively. The third scenario, which is dubbed the "most probable" one, is the one, which has provided the macroeconomic framework for economic development between 2001 and 2006. Each of these scenarios, are based on certain assumptions regarding the expected growth of the economy of Namibia during the life of NDP2. For purposes of this outlook study we have adopted the most probable scenario.

Table 2. Economic Indicators for Namibia

This scenario has been designed so that the probability of real-world outcome being better than that of the forecast is as equal as possible to the chance of the outcome being worse. In this scenario, world commodity prices and demand recover to a more limited extent, than in the high growth scenario. New mining projects go ahead but full output is realised later than planned or output does not reach the planned mine capacity during the NDP 2 period. Agriculture and Fishing recover but further expansion is somewhat limited by market considerations. Tourism growth continues as in the high scenario. Government final expenditure on goods and services expands at approximately the same rate as the population. Thus government current final expenditure per person at the end of the NDP 2 period is assumed to be approximately the same as the start.

These results show how susceptible Namibia’s economy is to changes in the external economic and physical climate. While policies on government current expenditure and investment do differ in each of the three scenarios, they essentially respond to the opportunities offered and the constraints imposed on them by the world economy.

The results also show that higher growth that starts form a mining impetus does continue but that Namibia’s economy has not yet attained a fully self-sustaining growth. Hence, the successful implementation of NDP 2 is essential to maintain the movement towards self-sustaining growth that is shown in the Middle and High Scenarios. In the Low scenarios, investment funds are limited, both form government and the private sector, as are investment opportunities. In this scenario, the investment elements of NDP 2 become less important than current budget management.

The projects for NDP 2 are based on the cautious central scenario (most probable), which projects that:

GDP growth at an average rate of 5% per year 1999- 2006

Mining output growing at an average rate of 6% 1999 - 2006

Private non-mining output growing at an average rate of 52% over 1999-2006.

Government final consumption of goods and services continuing to grow at a restrained rate of 22% annually over 1999-2006.

Average employment increase of 22% a year over the period 1999-2006, at the same rate population growth.

Budget deficit declining to between 3% and 32% of GDP. Dept growing to 24% of GDP. Both figures remaining stable in the last years of NDP 2

Total investment, private and public, growing by an average 5% per year over 1999 - 2006.

Balance of Trade deficit deteriorating to 14% of GDP by 2006. The Balance of Payments current account to become negative, at 12% of GDP by 2006.

The average growth in GDP will be 5.3% between 1999 and 2006.

The highest growth is likely to be registered 2001 to 2004 during which ann ual growth will average 6%.

Major driving sectors:

Mining will grow by an average of 8.2% during the same period

Tourism related growth is also estimated at 6% per year between 1999 and 2006

Meat and Fish processing will also increase annually by 6.4 and 6.7 % respectively

Commercial agriculture will also show strong growth of about 7% between 2001 and 2004 (expansion of the grape industry)

The construction industry is also expected to grow annually by 5%

Impact on the liberalization policies e.g. competition with EU in RSA’s meat market

The economy is made up of different sectors, each with its own potential to contribute to the objectives of growth with equity.

Some sectors, such as Mining; other Manufacturing, Finance, Real Estate and Business Services and Transport and Communication have the potential to create considerable value added. Some sectors, such as Agriculture, Wholesale and Retail Trade, Manufacturing as a whole, Transport and Communication and to a lesser extent, Hotels and Restaurants, Finance, Real Estate and Business Services and Fishing have the potential to create more employment. At the same time, some services sectors, such as Finance, Real Estate and Business Services and the Posts and the Telecommunications part of Transport and Communication have the potential to develop human capital. Other sectors, Tourism (represented by Hotels and Restaurants) being one example, have the potential to achieve a combination of these objectives.

Mining has traditionally been the foundation of the Namibian economy. During NDP 1, due to low world prices for commodities and the time needed to identify and exploit newly discovered deposits, the mining sector grew more slowly than the economy as a whole, at an average of 2.5% a year. The non-diamond part of the industry actually shrunk by an annual average of 2.0%. It is expected that both of these trends will be reversed during the NDP 2 period, so that diamond mining will grow about 1% a year faster on average than it did during NDP 1, while non-diamond mining will expand rapidly during much of the NDP 2 period at an overall average pace of 8.2%. These projections are subject to world demand conditions and thus also to changes in world prices. How far these projections are realised and how effectively the resulting wealth is used to achieve the aims of NDP 2 will to a large extent determine the future of the Namibian economy during and beyond the NDP 2 period.

Gains in mining productivity mean that, despite the growth in output, no employment will shrink. However, the data is scanty on mining employment other than for members of the Chamber of Mines. Therefore, the mining employment forecast is somewhat uncertain.

Elsewhere in the primary sector, Agriculture is expected to recover from the recent declines, which have natural causes. Commercial agriculture in particular is then expected to expand, partly due to short-term recovery from drought, partly due to the commercialisation of existing subsistence farming and partly due to the exploitation of new opportunities, such as grape growing for export. Fishing is expected to continue its long-term rate of expansion, though this is expected to halt at some point when the natural limits of exploitation are attained. Growth in both agriculture as a whole and in fishing is expected to be slightly faster than in the economy as a whole. The potential exists for increased employment in the non-mining primary sector, especially in agriculture.

All industries within the secondary sector are expected to grow slightly faster than growth in the economy as a whole. Within this group, meat and fish processing are forecast to grow a little more rapidly than the other sectors. In terms of employment, manufacturing as a whole is forecast to make significant contribution, with a smaller increase in employment expected from the Electricity and Water industry.

The tertiary or services sector is definitely a new growth area of the Namibian economy. Average growth is projected at 4% a year. This is somewhat slower than the economy as a whole. However, this growth rate is slightly faster than the 3.5% that the sector experienced during NDP 1. It is often not subject to the same risks as in natural resources; and is employment generating. Three trends explain this. The development of Finance, real estate and business services is a natural adjunct to the mining industry and has been supported by government policy. The development of Walvis Bay port and new road infrastructure, notably the Trans Kalahari highway. Will make a major difference to the Transport and Communication industry. Thirdly, the rapid application of new telecommunications technology is making the Namibian economy more efficient and bringing Namibians closer together. In addition, the central forecast is for continued growth in the tourism industry (Hotels and Restaurants) at a rate slightly faster than the economy as a whole. A large increase is forecast for employment in the wholesale and retail Trade, with fairly large increases also forecast for the Transport and Communications Industry and the Finance, Real Estate and Business Services industries. Employment in these sectors is driven by sector growth rates plus, in the case of wholesale and retail, low expected productivity growth.

The current forest policy which was adopted in 1992 has the standard features expected of a forest policy in that it provides the basis for legislation to confer authority to government to control and regulate harvesting and the movement of forest products. It also espouses sustainable management principles by declaring the commitment of the Government to conserve its representative forest ecosystems, increase tree cover and even declare new forest reserves. Furthermore it calls for the provision of information regarding the national forest resource through inventories, maintenance of a national database, extension, research and education. All these should be done within the context of contributing to the national welfare.

The policy document though it contains all the mundane issues in modern day forest practice has been criticized for being too encompassing and gives an inordinate amount of responsibility to the Central Government in the management, protection and promotion of forestry. In it, are no clear mechanisms for public participation in the face of today=s vocal and assertive rural populace who want to take control of the natural resources occurring in their midst. Hence, the new Forestry Strategic Plan of 1996 suggests the means necessary to promote its implementation and in fact calls for the review of the 1992 National Forest Policy itself. The policy, which also should be viewed as policy incentives, include; public ownership and operation, public regulation of the use of private forests, public stimulation, guidance and assistance to private forest management and promotion of the private implementation of forest policies. The current Directorate of Forestry has been called upon to seriously adopt some of these incentives.

One should note that policies in other sectors and especially local and regional government, lands and agriculture can contribute positively to forest management. A recent development in local government is the policy of decentralisation which is meant to give more responsibility to the regions to plan and implement and monitor development projects, in addition to becoming more responsible in the management of their natural resources. Much as this policy will depend on qualified planners and government section heads in local regions of which Namibia is still seriously short, the policy is definitely a worthwhile one which must be implemented systematically and be seen as a strategic choice for the empowerment of hitherto ignored communal areas.

The current Forest Act of 1968 which is being reviewed can only be considered as a major improvement since the current Draft Forest Bill of 1997 recognizes the rights of communities to identify forest resources they can claim to be theirs and legally declare them community forest reserves or forest management areas. In addition there is provision for local leaders being appointed and recognized as honorary forest offices. These are designed to attract public interest and to confer rights linked to their responsibilities to manage forest resources for their direct and indirect benefits. It is hoped that the bill will be accepted by parliament this year and drafted as the new forest act. The present and future revised forest legislations are complemented by the Nature Conservation Ordinance of 1975, as far as the conservation of nature are and hence biodiversity, are concerned. The act is administered by the Directorate of Resource Management in the same ministry as forestry and can be used to control the illegal harvesting of protected plants which includes Namibia’s key indigenous timber and fruit or nut producing tree species. The activities of Resource Management inasmuch as they protect wildlife habitats within National Parks, are also important in maintaining forest or woodland ecosystems. The new policy on wildlife conservancies and the amendment of the Nature Conservation Ordinance in 1996 to allow utilization of game for tourism and consumption on communally owned land will also confer protection of tree species which form an important component of wildlife habitats.

The traditional authorities bill may also clarify the role of traditional leaders and help minimize land use conflicts revolving around land allocation and tenurial arrangements which are often negative to, or prejudicial to forestry development. Along with this, is the proposed communal land bill, which will confer individual and group or communal tenure as a policy incentive to promote investment in the rural areas.

The forest sector is usually adversely affected by agriculture in most countries mainly due to competition with agriculture not only for land and resources but also for political support. In this regard, Namibia even though it has no industrial plantations, is no exception.

Consequently a forestry outlook study will be interested in the following:

Rate of conversion of forestlands to non-forest and often, agricultural purposes

Patterns of new settlements and the existence of settlement policies

The nature of agriculture; whether low input extensive or high input intensive

The predominant type of agricultural activities, which are cultivation and livestock

Increased dependence on marginal lands among the currently landless

The development of new crops and or new or expanded markets

The availability of roads, railways and means of transportation

Namibia’s agriculture depends on large-scale commercial livestock ranching for a traditional export market. Livestock husbandry is also widespread in the mainly subsistence economy of northern Namibia in which 70% of the total population is found. This zone of subsistence agriculture constitutes just about 43% of the total land, whereas the 6,500 commercial farms occupy 44% of the total land, with an average size of 5,800 hectares each.

As expected, the resultant higher population densities in the north put pressure on this arid to semi-arid environment. In addition, the northern part is not a disease-free zone and therefore does not have the same access to export markets that the commercial zone enjoys in Europe. To supplement incomes and meet their subsistence needs, rain fed crops are grown on small holdings. However, the scale of cropping is quite limited, hence Namibia still remains a net importer of grains to feed her rural and urban populations.

Between 1996 and 1999, agriculture has contributed an average of 8.7 % of the GDP. This figure which represents an average decrease of about 2 % during NDP1 was caused by a decline in the production from livestock ranches and a shift to non-traditional activities such as game farming linked to "trophy hunting" tourism. On the contrary the historically ignored northern communal region with its small-holder agriculture, has realized increasing animal production at a rate of about 7.1% per annum.

As the meat export figures show (Tables 3 and 4) the commercial agricultural zone and sub-sector traditionally dominates the export markets in both large and small stock. Strict disease control through exemplary disease management and exclusion programmes, have supported this trend, in addition to generous subsidies and supportive credit programmes in the recent past. A strong transport and communication network has also been a major factor.

A lot therefore needs to be done in the communal areas to improve livestock health, access to credit, markets and a more effective extension programme. Producer co-operatives to enhance collective bargaining powers are also needed. Despite the higher livestock numbers in the communal areas than in the commercial and despite cropping under unreliable rain fed agriculture, the region still relies on remittances from migrant labour and direct employment for much needed cash incomes, as livestock and crop sales remain insufficient.

Cropping is still limited and restricted by the low and erratic rains (300-700 mm per annum) and high potential evapotranspiration rates. This favours mostly drought hardy pearl millet and Maize, which does well in the Maize Triangle area in the north–central and north-eastern Namibia. Today, Namibia exports table grapes and cotton grown under irrigation in the southern parts.

During the next 6 years falling under the forestry outlook period, Namibia has recognized that it has to make certain policy changes and introduce new programmes.

There will be increased investment in the rural areas to contribute to economic growth at a rate higher than that of population increase.

Deliberate steps will be taken to continue to correct the historical imbalances which created a dual economy; one commercial and well resourced and another, poor and largely ignored.

There will be a re-orientation of research, extension and training and improvement in the availability of credit facilities. It has been realized the potential for growth gains in Agricultural Production is greatest in the northern communal areas.

The Ministry of agriculture will deliberately include Non-Governmental Organizations, the private sector and parastatal bodies in the sector.

Example of recent developments are given herein.

The Ministry of Agriculture plans to establish medium size quarantine camps closer to producers

There will be an improvement of delivery of veterinary drugs by a series of cold storage facilities ("cold chains")

There is already an increase in the processing of dairy products such as yoghurt and cheese and long-life Ultra Heat Treated Milk (UHT).

There are efforts to maintain existing markets and find new ones.

The current maintenance of strong quarantine practices between Namibia and Botswana has helped maintain Namibia’s export quota to the European Union.

During NDP2 research will be intensified to increase yields on cereals and grain legumes.

Examples are as follows:

Today three varieties of pearl millet have been developed and have enjoyed an average adoption rate of 49%.

The growing of legumes such as, cowpeas, bambara nuts and groundnuts (peanuts) are being promoted.

Alternative food crops, such as sweet potato, is being promoted alongside cash crops such as cotton and a native medicinal plant, the devil’s claw.

Cotton promises to be a promising cash crop that has the potential under rain fed or irrigated conditions. Local production increased from 400 tons in 1992-1993 to 4,400 tons in 1998-1999, mostly from large scale irrigated schemes in the Hardap Region of Southern Namibia. It is estimated that area of production could increase by 2,000-3,000 hectares per year with a potential of 18,000ha in the communal areas. This in addition to irrigated fields could meet an annual production rate of 15,000 tons needed to establish and maintain a local ginnery.

Grape production has increased in value from 21 millions NAM$ in 1994 to NAM$ 43 millions in 1998. Lucerne and groundnut production are also increasing.

Table 3. Livestock number on communal land and commercial farms

Source Ministry of Agriculture 2000

Table 4. Marketing trends for cattle and small stock

Source Ministry of Agriculture 2000

Table 5. Beef exports to EU (UK, Germany, Netherlands, Belgium, France, Denmark, Norway)

Source Ministry of Agriculture 2000

As stated earlier on, Namibia has an extremely skewed land ownership situation. About 45% of Namibia namely the Central Plateau Region, is occupied by about 6,500 freehold commercial faming units that average about 5,800 hectares per holding. The majority of Namibians are confined to the North on communally owned land, which constitutes about 25% of the land area and has to be shared among 60-70% of the entire population of 1.7 million people. Unsurprisingly, land redistribution is a big political issue with strong racial dimension since the minority white population control the 45% mentioned herein. It is therefore important that agricultural development in the northern communal lands should be made more profitable and some form of redistribution should be promoted in a manner that minimizes the economic and political costs of at the national and international levels. The principle of willing seller – willing buyer still holds in Namibia and property rights are upheld.

In terms of investment in agriculture, the communal areas were virtually ignored and very little irrigation takes place along the northern rivers even if this is what one would expect in an arid country. Furthermore negligible work has been done to promote arid land agriculture in general. In view of the current land bill, which promotes communal tit le deeds for joint investment projects, agricultural credits could use communal deeds as security to enable much needed investment in for example, horticultural and commercial livestock production in northern Namibia.

In Namibia, industrial development is likely to be more positive than negative to the forest sector. This is because it is likely to create alternative employment opportunities that will relieve pressure now exerted on forestlands by subsistence agriculture. Even if, industrial development converts forestlands the current exercise to declare a permanent forest estate will tend to make it difficult for future conversions and only allow those that are clearly in the national interest and after a period of debate. It is also likely that the remaining forestlands will be better managed in a future decentralized forest administration once forest areas have been legally declared and protected by a recognized law. Given the current rate of unemployment and the absence of industrial plantations, it is unlikely that industrialization will seriously affect labour for the relatively small forest sector.

In the current report on Namibia’s macroeconomic framework for National Development Plan II (NDP2), growth in tourism, which is the premier service sector, is projected to grow by at least 5% per annum, which will be above that projected for the annual growth in GDP.

Today, Namibia has recognized that significant growth outside the mining sector lies in tourism and other services industry. Growth in this sector is likely to have the following effects on the forest sector:

An increased demand for wooden arts and crafts to supply tourists and locals

Improvement of policies that are friendly to sustainable management of natural resources and conservation of key ecosystems and threatened and/or economically important plant and animal species.

A greater sensitivity on the part of Namibians to maintain an attractive physical environment

Greater employment opportunities leading to poverty reduction and greater consideration of environmental values.

Improved services in tourism and finance is likely to attract associated investments through improved capital in-flows; all of which will tend to favour the sustainable use of Natural Resources.

In the energy sector, 3 major issues could come to the fore in Namibia. These are:

Changes in the demand for biomass and mainly wood fuels

Discovery and exploitation of natural gas

Development of further hydro-electric power

Today, Namibia consumes about 1.2 million tons of fuel wood per year, most of which occurs in the rural areas and by a majority of Namibians in the urban areas of northern Namibia. As the GDP improves and more people join the cash economy and considering the availability of alternative sources of energy, a shift from the use of raw wood is likely. This is likely to happen because:

The largest field of natural gas in Southern Africa was recently discovered in Southern Namibia and its exploitation is likely to be realized within the next decade.

Namibia is planning a second hydroelectric power project on the Kunene River in the Northwest, to provide cheap power, especially to the highly populated north. The availability of cheaper power is likely to spur industrialization in Namibia’s most populated region and is likely to reduce dependence on biomass energy as the average rate of affluence go up.

The current feasibility studies on wind energy on the windy area along the coast in Southern Namibia is also likely to materialize during the next 10 to 12 years. More power generated will feed into the national grid and provide power for more people.

Namibia in comparison to many countries in Africa is served by a well-maintained network of all weather roads and also highly functional fixed and cell phone network systems. Virtually no area with forest resources and areas of economic activities are well served with roads and communication facilities. It is therefore unlikely that Namibia will see major changes other than in external trade.

In this regard the planned railway link to Southern Angola is likely to supply more forest products to Namibia from forest-rich Angola and eventually also from the Democratic Republic of Congo. Increased sea traffic using Namibia’s main port of Walvis Bay will also be a major boon to the envisaged veneer plant the export-processing zone.

Another possibility is that better communication if used properly could open more access for Namibia’s art and crafts in external markets. In this non-timber forest products with unique values such as indigenous fruits and medicinal plants could benefit.

In discussing trade liberalization in the African Context one should not lose sight of Structural Adjustment Programmes (SAPS) often imposed by international lending institutions since market liberalization is one of the exponents of SAPS.

In general liberalization of Namibia’s economy, which is already ongoing, is expected to have the following positive effects:

Lead to the elimination of trade barriers within a trading block of countries

Enable the free movement of capital into and outside Namibia

Benefit consumers who will be presented with a variety of goods

Eliminate or reduce import controls and encourages exports

In a forestry context and in the absence of industrial plantation forestry in Namibia, trade liberalization could have the following impacts:

Enable Namibians to freely import its forest products from a variety of SADC member countries and hopefully at competitive prices.

Should enable Namibia to set up value-added industries based on imported wood from SADC for purposes of local market and re-export. The planned veneer plant at Walvis Bay is a case in point.

The free flow of capital into Namibia should facilitate investment in wood processing plants.

Since liberalization tends to militate against import-substitution industries and protectionist economic policies, it could affect forestry indirectly in that locals will need cash to buy imported goods and under conditions of high unemployment as is currently the case, rural populations are likely to revert to the exploitation of forest resources and the conversion of more forest land for subsistence and often unsustainable agriculture.

The technological changes that may favour the forest sector are likely to be:

Technologies that will allow the manufacture or processing of environmentally friendly wood and non-wood products using abundant resources such as encroaching bush in Central Namibia and other lesser known species. There are indications that certain particle and wafer boards could be made from such species and could be covered with valuable veneer for the construction and joinery industry.

Better or improved technology to manufacture and finish wooden products is a major possibility and the Government is already encouraging this in community-based forestry development projects.

Drought resistant crop varieties may lower the rate of widespread conversion of forestlands to agriculture

Selection and genetic improvement of indigenous fruits and nuts is likely to create local and export markets.

Faced with growing unemployment and a relatively small economy on a narrow industrial base, Namibia is beginning to explore ways of creating employment by investing in natural resource –based industries among others. This is supported by the fact that it enjoys per capita incomes making it the envy of many of Southern African Countries. One complaint in the insurance industry is that over 50% of premium payments have to be invested outside Namibia since its economy cannot absorb it all in investments. It means that there is room for investment to create wealth and provide employment and in this regard, the forest sector could offer a number of profitable investment potentials to help mitigate the problem of capital outflows.

Reconstituted wood products using the abundant encroaching bush is just awaiting improvement in technology to make it a worthwhile industry to make boards, exportable insulation panels. It has a huge potential for growth and employment creation.

It has also been shown that trees species such as Burkea africana, which are currently not commercially exploited, can be used to produce high quality wood for "parquet flooring". Namibia has substantial quantities of the species to make it a viable small-scale industrial targeting the local market.

The charcoal industry has the potential to double its output and could gain from recent technologies in making briquettes and the manufacture of industrial carbon

As stated earlier, Namibia’s proximity to less industrialized but forest-rich neighbours such as Angola and the Democratic Republic of Congo makes it possible for Namibia to create value-added wood-based industries, such as the planned veneer plant at Walvis Bay.

There is also a new realization that cottage industries such as processing of oil from tree nuts and the improvement of art and crafts can be viable economic activities that Namibia should pursue. Hence novel products from nuts and traditional arts and crafts are likely to attract investments in the future.

With regard to International Environmental Treaties, it is noteworthy that Namibia, which joined the United Nations as an independent state only in 1990, is already a signatory to, and has ratified most major environmental treaties or conventions. In 1992, Namibia acceded to the two Conventions on Climate Change and Biodiversity at the Rio Earth Summit. Another key treaty or convention is the one concerned with the Control of the Trade in Endangered Species (CITES) which Namibia joined in 1991. This convention was recently the cause of much anxiety and debate in the last June 1997 CITES Conference in Harare Zimbabwe, over the proposed sale of ivory stocks by Namibia, Botswana and Zimbabwe. Namibia has also acceded to the Convention for the Protection of the Ozone Layer in 1993, the Wetlands Convention in 1995 and most recently, Namibia ratified the Desertification Convention in 1997. The activities on Combating Desertification are essentially multi sectoral even though there is a National Committee to Combat Desertification co-ordinated from the Directorate of Environmental Affairs, which is a sister Directorate to Forestry in the same ministry. The Basel Convention on the trans-boundary movement and disposal of toxic wastes, is yet another treaty which Namibia is considering acceding to. Coming to global forestry policies, Namibia is already on its way to developing national Criteria and Indicators for Sustainable Forest Management, to help it to periodically assess the performance of the sector and it also provides the basis for developing National Programmes to enable the systematic implementation of IFF/IPF proposals for action.