Brigitte Weidlich
24 November 2008
G OVERNMENT will set up a company to reap the benefits of the local mining sector, Mines and Energy Minister Erkki Nghimtina said in Parliament last week.
"It is time that we as Government participate in the mineral sector and for this reason I requested Cabinet that a State company be established."
According to him, the new enterprise has already been registered with the Ministry of Trade and Industry.
"The management soon will be constituted."
Nghimtina was replying to a debate on an amendment to the Minerals Act he tabled recently.
It will provide for a royalty to be imposed on all minerals extracted in Namibia.
Currently royalties are only levied on precious stones like diamonds and dimension stone such as marble, sodalith and granite, and are between 3 per cent and 5 per cent.
Mining companies already pay higher corporate taxes (37,5 per cent) than those not involved in mining, which pay 35 per cent.
The proposed amendments will bring to an end the sale and export of mineral resources without royalties paid to the State, according to Nghimtina.
It will also remove restrictions on the maximum royalties to be charged.
In addition, the mining minister may also impose an unrestricted 'windfall royalty' on the holder of a mining claim or a mining licence should market prices of a mineral resource have increased so much that the mining company's operations have become "significantly more profitable".
Nghimtina said he and Finance Minister Saara Kuugongelwa-Amadhila would sit and "brainstorm" to possibly reduce the corporate tax of some mining companies where feasible in favour of increased royalties.
"I say so because I am convinced that royalties will generate more revenue for the Sate than taxes," he said.
Some years ago, Government started a diamond mining company as a subsidiary of August 26 Holdings, a company run under the Defence Ministry.
This was done after former Democratic Republic of Congo president Laurent Kabila 'donated' a diamond mining area to Namibia after Namibian troops fought in that country's civil war.
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YEAH!!! Africa will rise again only when such reasoning once again take hold.We have to control our mineral resources for the betterment of the citizenry.Let other African countries that have not yet gotten it take a leaf from the government of Namibia,if we want to come out of our present state this is the way to go.All the other countries on the continent that have the same characteristics as Namibia should henceforth proceed to making amends, it,s not too late, we as a people and as a continent must take responsibilities of our lives and as such control over our properties and rights and subsequently proceeding to finding ways to apply those benefits to our upliftment and growth, it,s our right and so must be claimed without excuse. The banditry and thievery that,ve been the case all through our engagement with foreigners and imperialists has to be reviewed and a more appropriate order restored and one that sheds light more on the injustices and thievery of the past employed to the maximum.