Windhoek — The African Development Bank (AfDB) has agreed to infuse an additional N$2 billion in loans into the Namibian economy, after the injection of a N$3 billion loan to finance the country's development programme this year, specifically focusing on economic governance and improving competitiveness.
On Monday this week, the AfDB board in Abidjan approved a loan of N$2 billion to finance developments in Namibia's education and training sector, as well as its agriculture sector.
Each sector got N$1 billion as part of the loan agreement. The funding for agriculture would go to the country's Agricultural Mechanisation and Seed Improvement Project (NAMSIP) under the Ministry of Agriculture, Water and Forestry.
The loan for educational purposes will assist to "deliver an efficient effective and sustainable Technical, Vocational Education and Training (TVET) system in Namibia that is aligned with current and future skills needs of the labour market," AfDB said in a statement.
Yesterday, Bank of Namibia Governor Ipumbu Shiimi said the country's foreign reserves were now at their highest level, both monthly and annually, with N$31.6 billion to cover 5.1 months of imports, thanks in part to the AfDB loan.
The AfDB says it had agreed to the new N$2 billion in loans, because Namibia's development strategies in the two sectors align with the AfDB's own aims. Namibia's agricultural development strategy is "aligned to the AfDB's High-5 priorities of Feed Africa, and Improve the Quality of Life for the People of Africa", while the education and training as part of the government efforts to reduce poverty and youth unemployment align with AfDB's country strategy paper."
In agriculture, the funding would assist the "two key components of Value Chain Improvement, with agricultural mechanisation and certified seed systems as sub-components, and Institutional Support through Capacity Building, and Project Management."
"[The project being funded] aims to enhance agricultural productivity in order to reduce annual importation of staple cereal crops/grains, facilitate job creation, and enhance household incomes, which will improve the lives of rural people," AfDB said.
The funding for the education and training sector will specifically help to increase access, equity and the quality of TVET and basic education in the country.
"Specifically, the project will help to increase access, equity and quality TVET and basic education in the country. It will also support the development of basic education and TVET infrastructure in 11 regions of the country and strengthen the TVET and basic education systems through institutional capacity building. On completion, the project will help reduce youth unemployment estimated at 34 percent as of 2016," the bank said.
The statement further noted that with the latest round of funding the bank was enabling Namibia to meet her national goals, as specified in the Harambee Prosperity Plan, the Fifth National Development Plan and the Growth at Home Strategy for Industrialisation.
The education and training project will be implemented over 60 months with the N$1 billion AfDB loan and an additional estimated N$300 million from the Namibian government.
Further, the agricultural programme is expected to benefit large numbers of crop farmers and livestock farmers.
"In addition, the project will fully support 111 smallholder farmer cooperatives and indirectly benefit about 800,000 people along the cereal crops and livestock value chains," AfDB said.
It is estimated that the agricultural project will cost N$1.42 billion, with the AfDB loan financing 70.5 percent of the total project cost, while the government and beneficiaries will contribute the remaining 25.5 percent and 4 percent, respectively.
The project will be implemented by Namibia's Ministry of Agriculture, Water and Forestry over a period of five years, in all 14 administrative regions of the country and will directly benefit 294,500 crop farmers and 10,000 livestock farmers.