Namibia may scrap black ownership requirements for mining companies, minister says

Namibia may amend its policies regarding ownership in the mining industry. (Reuters pic)

WINDHOEK: Diamond and uranium producer Namibia may scrap requirements for black ownership in the mining sector as it seeks to impress investors to an industry that is rebounding with the commodities cycle, its new mining minister said on Tuesday.

Nearby countries such as Angola and Zimbabwe are also trying to kick-start their mining sectors by easing investment rules at a time when other African countries such as the Democratic Republic of Congo are embracing resource nationalism and hiking taxes and royalties.

“I am not going to withdraw them (black ownership requirements) unilaterally, obviously we first have to discuss and see if they are really serving the purpose of why they exist. If the answer is, they don’t, then maybe we should change,” Mines Minister Tom Alweendo said.

“To give exploration licenses to many people who won’t add value, I think we are just slowing down the (black) empowerment that we want to achieve at the end of the day,” he said.

Under the current policy, there must be a minimum of 20% representation of black Namibians in the management structure of a company that applies for an exploration license.

At least 5% of the company must be owned by Namibian citizens or by a company wholly owned by Namibians.

Namibia gained its independence from South Africa in 1990 and the former German colony suffered from apartheid-style rule with the white minority controlling most of the economy.

The disparities rooted in this state of affairs remain politically thorny issues in both countries.

South Africa’s mines minister will appeal a court ruling that held that mining companies did not have to maintain black ownership targets in perpetuity, the Department of Mineral Resources said on Tuesday, adding an unwanted layer of policy uncertainty in the world’s leading platinum producer.