TRADE: Sweden steps up trade co-operation with Namibia

JOHANNESBURG. Swedish business with Namibia does not affect any share price; total trade during the first six month´s of 2005 was SEK 14 million.

That is about to change though, at least if things go the way the Swedish Trade Council´s (STC, Exportrådet) regional office in South Africa hopes for.

STC will, with funding from Sida, set up a hub in Namibia´s capital Windhoek to, in particular, promote investments.

The new initiative, done in the spirit of a new partnership approach that replaces dwindling aid cooperation, is not a one-way affair. It will also be funded from the Namibian side.

“We will place a co-coordinator in Windhoek and we will also have a dedicated person at the Swedish Trade Council in Johannesburg. That way we can also assist in encouraging the Swedish companies in South Africa to look at opportunities in Namibia”, says Andreas Skinnars, head of the Swedish Trade Council in the region.

There are only a few Swedish companies that have subsidiaries in Namibia – they are normally branches of South Africa based subsidiaries.

Trade has never really flourished. Swedish export is miniscule; SEK 12 million during the first six months of 2005, but most of the export would not show as it would be indirect via South Africa.
Namibia´s export to Sweden looks even more pathetic, it stood at SEK 2 million during the period. But that does not include Namibia´s main foreign currency earners – diamonds, uranium and tourism.
The country is a major diamond producer, but diamonds are anonymous when they are sold.
Uranium exports, if any, to Sweden is even trickier to examine. Sweden´s nuclear material is not imported directly from the source.

Tourism is showing very promising signs. Swedes going to Southern Africa have, as so many German´s, discovered Namibia´s game reserves, the marvelous desert drives and that fantastic seaside resort, Swakopmund.

To be honest, Namibia does live a life on the margin, overshadowed by South Africa. Closeness to South Africa´s markets, Namibia is part of the Southern Africa Custom Union, which gives it free access to South Africa´s markets, also means that there are vast opportunities on the country´s doorstep.
Namibia´s most significant export success so far – besides diamonds – has been the extra-ordinary growth of Namibian Breweries, which brews according to the German Reinheitsgebot set of rules.

Africascan View:

From the outset Namibia looks very much as an outpost not really worth considering for a resource strapped Swedish exporter/investor.
But it has a certain allure, and there are certainly many opportunities that are similar to South Africa.
Tourism is an obvious one. Why there are no direct Nordic packages to Namibia when tens of thousands of German´s find the country so fascinating (well, yes they would as there is a German minority there) is a mystery. The infrastructure is as good as in South Africa, so there is nothing to fear – only pleasure. Not the least as you can fly straight to Windhoek from Frankfurt.
Mining exploration is another obvious area. It´s not exactly a Nordic specialty, but Namibia is awash with opportunities, something that the Australian mining explorers not the least have figured out (even more so in Botswana where Australian´s now have more exploration rights than the South African´s).

And why not beer? Windhoek Lager is a fine beer. It has taken a fair share of the South African premium market away from its neighboring giant SABMiller.

Fruit represents another opportunity that Saba has figured out. It set up a grape plantation on the shores of the Orange River – on the Namibian side – in the late Nineties.

Property would be attractive too, in particular farm- and game land, depending on which direction the land legislation is going. At the moment there are limitation for what foreigners can do in that regard.
A land reform, sometimes with “Mugabesque” undertones, is under way. It is needed as long as it is done in an economically sensitive way.