Namibia faces power, regulation hurdles for mineral processing
Former central bank governor Johannes !Gawaxab identified electricity costs and unpredictable rules as key barriers to developing Namibia's mineral sector.
Namibia's mineral beneficiation plans face significant obstacles, including high electricity costs and uncertain regulations, according to former Bank of Namibia Governor Johannes !Gawaxab. Speaking in Johannesburg, !Gawaxab stated that resource-rich African nations struggle to translate mineral wealth into industrial development due to structural barriers. He highlighted electricity, regulatory frameworks, infrastructure, and access to patient capital as the primary constraints.
"Africa has an electrons problem, a rules problem, a competitiveness, and a patient-capital problem," !Gawaxab said, emphasizing that value addition requires solving these issues. He noted that while Namibia has imposed export restrictions on minerals like lithium and cobalt since 2023 to encourage domestic processing, these measures alone are insufficient. "Bans tell capital where it may not go. They don’t tell it where it should go," he explained.
For Namibia's mineral processing ambitions to succeed, electricity must be competitive with international prices, and reliable power is essential for smelting and refining. !Gawaxab also stressed that investors need predictable, long-term rules, not ones that frequently change. He suggested that African institutional investors, such as pension funds, could increase their role in financing mineral processing and infrastructure projects.
Why it mattersInvestors need predictable regulations and competitive electricity prices for Namibia's mineral processing projects to attract long-term capital.