Namibia: Do Not Let a Good Pandemic Go to Waste – Nuyoma… Namibia Should Capitalise On Weakness Exposed By Covid-19

A post-Covid-19 environment requires a fundamental change in how business and investments are approached. While the pandemic has forcefully changed the world, the challenges exposed by Covid-19 are serious but they are not insurmountable.

This was the message from Government Institutions Pension Fund (GIPF) CEO David Nuyoma when he made the opening remarks this week at the fourth Eljota Investment Summit that took place in Windhoek.

“A new environment requires a new mindset; we have a very unique opportunity to realise a captive market, an opportunity to create thriving businesses, vibrant local sectors, deeper financial markets and wide participation in the growth of the local economy. This is a rare opportunity that may not present itself soon again. We must embrace the hard lessons learnt and incorporate them into our thinking and our policy going forward,” said Nuyoma.

To drive home his point, Nuyoma cited the British Prime Minister Winston Churchill during World War II, who told his cabinet at the height of the global conflict to “Never let a good crisis go to waste”.

Nuyoma explained that much like the second World War, the Covid-19 pandemic will be classified as one of the great seismic global events that changed the world as it was known.

Said Nuyoma: “Whilst one cannot ignore the devastating loss caused by this pandemic, I have taken a perspective to deliberately recognise the opportunities, such seismic change, present to us. One could argue that, surely, the words ‘good’ and ‘crisis’ should never be read out in the same sentence – but ladies and gentleman, I tend to side with Mr Churchill, especially considering the financial, trade and investment environment we find ourselves currently in”.

GIPF, as a long-term institutional investor, is exposed to most large global economies that left it exposed and vulnerable to the full impact the pandemic had on global financial markets and the overall institutional investor landscape.

However, the Fund has over the past 11 months, since the height of the pandemic lockdown, managed to grow its asset base from N$108 billion in March 2020 to N$132 billion in March 2021 and has made some notable unlisted investments in strategic sectors.

“This was achieved by seeing the current environmental challenge as an opportunity in disguise – and by making a number of tactical investment decisions without ever needing to alter its strategic asset allocation,” Nuyoma explained.

He noted that one of the few benefits of the pandemic is that it immediately highlighted what is important and critical in any given context. In fact, during the height of the shutdown that began in March 2020, a number of sectors were identified as critical and of national strategic importance. These include healthcare and pharmaceuticals; agribusiness and food security, as well as safety and personal protective equipment (PPE).

In terms of healthcare and pharmaceuticals, as well as PPE, GIPF has invested in three companies that have the technical and operational capacity to manufacture 100% Namibian produced Paracetamol, immune boosters, Hydroxychloroquine, sanitiser, ethanol and all PPE, such as surgical protective masks, latex gloves and so forth.

Said Nuyoma: “During the height of the pandemic, countries started stockpiling essential medical and protective gear supplies. Our main import partner, South Africa, followed suit and restricted the export of such goods. We were found wanting in this regard, and our dependence on imports on products that we have the capacity to produce was brought to the fore”.

Moreover, relating to agribusiness and food security, Nuyoma stated that Namibia has an annual consumption capacity of 16 000 tons of maize and another 160 tons of wheat and 30 000 tons of potatoes.

“As of last year, our country produced less than half of its annual demand and imported the rest. This presents a clear opportunity. Namibia has the potential to be maize and potato self-sufficient within 12 to 24 months. With an estimated development and production budget of N$500 million, the Namibian maize and potato gap can be closed. To date, GIPF has invested in excess of N$120 million in the production of maize and blueberries, which anticipates producing in excess of 10 000 tons of grains, animal fodder and fruits this year”.