First, unlike Nigeria, Kenya, or South Africa – the continent’s giants – Namibia has no hope of growing rich off its domestic market as it simply has too small a population base. However, its small population does mean that the potential to grow rich off of exports – particularly mineral exports, is definitely there, and mining and the mineral trade make up a great deal of the country’s economic activity. Here uranium, diamonds, gold, silver, and copper are major earners.
Natural gas and oil are also potential resources plays in Namibia, and several major international oil companies have begun to explore the waters off its coasts. Interest in the country’s northern waters is of particular interest here as Angola’s offshore fields are in relative proximity. What’s more, given there is a widespread belief that the oil-rich, deepwater pre-salt deposits that have recently been found in Brazil’s offshore also lie off of much of the coast of Western Africa, exploration activity in Namibian waters could soon be picking up.
The next major source of income is agriculture, which is split into two sectors. The first is dominated by white-owned commercial farms which produce for export while the latter are inefficient subsistence farms upon which a large portion of the black population relies.
This situation, as elsewhere in Southern Africa, is politically problematic, but so far land reform, coupled with the country’s small population and copious amounts of foreign aid, has so far made this problem a manageable one.
Figure 3:
Namibia Economic Growth,
Percent Increase, 2003 – 2013
What’s more, Namibia also has potential in terms of commercial fishing and tourism. Its beaches are some of the least spoiled and its interior, though dominated by the forbidding Namib Desert, nonetheless holds potential for ecotourism.
Additionally, given advances in renewable energy technology, solar and wind energy hold the potential to very easily power the entire country, given enough investment. Namibia’s extensive system of game reserves also holds great tourist potential.
On top of this, Namibia is a country with a relatively efficient and uncorrupted legal system with an entrenched respect for property rights and the rule of law. It is also a stable democracy and so far elections, unlike in much of Africa, have become routine and unremarkable.
SWAPO, like the ANC, remains the overwhelmingly dominant party, but so far has seemingly been able to avoid most of the problems associated with commanding such a dominant position in the country’s political system.
That is likely due to the country’s small population. Being so small, politics – as much of the rest of social life – is a much more person-to-person endeavor more typical of small-town politics than the big-ticket campaigns one sees in larger democratic countries. This, like other small, democratic countries, brings a stability that is immensely valuable.
Yet small populations bring problems, too. Having so few people, labor is thus scarce and as a consequence relatively expensive. Since its domestic market is too small for development to occur internally, the country must as a consequence bring the world to it as opposed to relying on its own resources.
Unfortunately, like most of the rest of Africa, infrastructure needs improvement and brining in people – either as tourists or as skilled workers – is expensive.
Still, despite that, Namibia is a place to watch. Bloomberg, for instance, named it one of the top 20 emerging economies in 2013 – largely due to its political stability, sound economic management, resource potential, and social ills that are soluble given its small size.
In many ways the country is very much like a frontier out of the Old West – wide open spaces, few people, and an economic and political system that would be familiar to most Western investors. Namibia’s future could thus be very bright if, that is, it only had just a few more people.
Jeffrey Cavanaugh holds a Ph.D. in political science with a specialization in international relations from the University of Illinois at Urbana-Champaign. Formerly an assistant professor of political science and public administration at Mississippi State University, he writes on global affairs and international economics for AFK Insider, Mint Press News and BAM South.
