* Industry to create 12000 jobs
* GDP growth expected at 5.8%
* Calls for strict transparent policies
* Govt wants to review contracts for compliance
BY TIRI MASAWI
Institute for Public Policy Research (IPPR) executive director Graham Hopwood has urged Namibia not to get carried away with expectations about oil and gas, warning that overpromising could leave the citizens disappointed if benefits take longer to materialise.
His views come at a time when a baseline survey released by Deloitte this month shows Namibia will create about 12 000 direct and indirect jobs from the oil and gas industry during the construction and production phases of the industry.
This is a far cry from the 15 000 that the industry has been pushing for.
“It’s important that the government is realistic about the prospects for local content. The expectations around local involvement have to be managed carefully. The main benefit from oil production will be a huge cash infusion into government coffers coming from taxes and royalties paid by the international oil companies,” Hopwood said.
Hopwood added “it will then be up to the government to use this cash bonanza (which may only come in ten years time) wisely and for the benefit of the Namibian people,” he said.
A Deloitte baseline survey shows strong interest from Namibian firms in benefiting from the soon-to-be-finalised Local Content Policy, but warns that limited skills and capacity could hinder their participation.
REALITY CHECK
According to the Deloitte baseline survey, Namibia’s oil and gas is expected to create 5000 jobs during the construction phase. These will include 500 direct jobs, 2 000 indirect jobs and 2 500 induced jobs.
Most of the jobs in the construction phase will come from the transport industry which is expected to create about 953 jobs.
The wholesale and retail trade is expected to create 598 jobs and private households services about 595 jobs.
Hopwood said it is also understandable that Namibians will want to participate in meaningful ways as the suppliers of goods and services for the oil industry.
“Since upstream petroleum is such a hi-tech industry these opportunities may be limited. We can use the time gap until production starts to gain as many relevant skills as possible,” Hopwood said.
The Deloitte baseline survey shows that in the construction phase, Namibia’s Gross Domestic Product ( GDP) is expected to grow by about 1%. This, Deloitte says, will result in estimated GDP average impact of about N$18 billion (US$113 million) contributed by the oil and gas industry every year The survey comes at a time when the government is on the verge of finalising a local content policy that makes it mandatory for international oil companies to source both local skills and services.
The government now plans to review contracts of up to N$4.5 million (US$250 000) entered between international oil companies operating in Namibia and their contractors to make sure they satisfy aspects of the country’s local content policy.
The Deloitte Baseline Survey also shows that Namibia will expect an estimated 7 000 jobs including 600 direct jobs, 600 indirect jobs and 5 800 induced jobs during the production stages.
PUSH FOR TRANSPARENCY
Hopwood said the IPPR’s main concern is that local content should be handled transparently and that there is a level playing field for companies.
“We have suggested policies and actions to reduce corruption risks. This include anti-corruption clauses in contracts to set clear expectations and signal commitment by government and companies. Establish independent oversight bodies for local content policy, ensuring vetted suppliers have clean track records. “Ensure procurement regulations guarantee fairness and guard against overpricing, bid rigging, and cartel activity. Require beneficial ownership disclosure to prevent contracts going to front companies,” he said.
Hopwood said there should be mandatory transparent reporting on local content (jobs created, goods/services purchased, beneficiaries identified) to track impact and detect corruption or mismanagement.
“Require licence holders, including international oil companies, to conduct due diligence and risk assessments on suppliers and commit to anti-corruption provisions in contracts. Include anti-corruption clauses in contracts to set clear expectations and signal commitment by government and companies,” he said.
Hopwood said there is a need to establish independent oversight bodies for local content policy, ensuring vetted suppliers have clean track records.
He added that the government must ensure procurement regulations to guarantee fairness and guard against overpricing, bid rigging, and cartel activity.
“Require beneficial ownership disclosure to prevent contracts going to front companies .Require licence holders, including IOCs, to conduct due diligence and risk assessments on suppliers and commit to anti-corruption provisions in contracts,” Hopwood said..
CONTRACT REVIEWS
According to the final draft Local Content Policy dated March 2025 from the Ministry of Industries, Energy and Mines, the government shall, where it considers necessary, review some contracts entered by contractors or its sub-contractors or any other related entity to ensure compliance with Namibian local content reporting requirements. The government says the draft Local Content Policy is a key tool for promoting economic sovereignty and reducing dependency on foreign expertise by building local capacity.
The draft policy calls for the listing of all contracts, sub-contracts and purchase orders for review .
It will also cover estimates of Namibian content, commencement and completion dates and any other information required by the Ministry of Finance for the purposes of implementing the provisions of this policy.
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