Trade Performance Review 2005: Namibia

Year of publication: 
Moureen Matomola & S'khumbuzo Dlamini
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Namibia has abundant natural resources, good infrastructure and access to markets, but contrary to this potential, the economy is not well diversified. Economic activities are concentrated in primary sector activities namely the extraction and processing of minerals for export which accounts for 20% of GDP, large scale commercial livestock farming, and fishing. This has resulted in the economy being highly vulnerable to world market price fluctuations especially for products such as diamonds (BON, 2003).


In recognition of the importance of international trade and foreign direct investment in promoting economic growth, the government has opted to pursue an export-oriented strategy for economic growth and development, in which export push and investment promotion are central elements to the country’s trade policy and development strategy. Regional integration arrangements are also seen as vital in addressing critical demand-side constraints faced by Namibia due to its limited domestic market. It is believed that Namibia can overcome such constraints in the context of a larger regional market.

Regional integration is also viewed by the government as the stepping-stone to the country’s integration into the world economy (Kalenga, 2004). Namibia is currently developing a trade strategy which will cover most sectors of the economy. This strategy will be completed in 2006. Namibia’s small domestic market has forced policy-makers to focus on trade development as a way of achieving economic growth and poverty reduction. Until recently, trade policy has been loosely defined, though it features prominently in the overall development policy for the nation. The National Poverty Reduction Plan of 1999 cites export-oriented industries as a means of providing employment opportunities that will lift people out of poverty. Vision 2030, a long term development plan for the country, echoes the Poverty Reduction Plan, with strong emphasis on export-oriented industrial and service sectors. Some Namibian organisations, such as the Meat Board, have been active in developing their own trade policies and actively engaging in trade negotiations at many levels.

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