Cabinet has resolved to prohibit the exportation of Namibia's critical minerals in raw form in a bid to create more local jobs and more local value.
This submission was made by the mines and energy ministry last week, and applies to materials such as unprocessed crushed lithium, graphite, cobalt, manganese and rare earth elements. At its eighth decision-making meeting on 6 June 2023, Cabinet nonetheless approved that smaller quantities of these minerals may be exported at the direction of the ministry.
Local value-addition remains a challenge for Namibia, where the majority of its natural resources are still being exported in raw or minimally-processed forms. This, pundits argue, continues to create valuable jobs in other countries. However, Namibia has been receiving offers to help establish a mineral beneficiation sector in the midst of increased global competition for rare earth minerals, driven by an expanding electric vehicle (EV) industry.
The European Union (EU) recently confirmed its willingness to support Namibia in further developing a home-grown extractive, refining and recycling industry for raw materials.
"Namibia is an important partner for the EU, and we want to work together on solutions to global challenges. Our new strategic partnership on raw materials and green hydrogen is a crucial part of our cooperation. This will encourage Namibia's sustainable growth and development, while bringing added value for the local economy by creating new jobs, infrastructure and other opportunities," said EU commissioner for internal market, Thierry Breton recently.
The EU aims to ensure the development of a secure and sustainable supply of critical raw materials, refined materials and renewable hydrogen to support Namibia and the EU's green and digital transformation.
Similarly, in recent remarks, German chancellor Olaf Scholz said his country wants to help mineral-rich countries like Namibia build their processing infrastructure to cut dependency on China.
"At the moment, we import raw materials from China, which is despite the fact that rare earth copper or nickel are often not even extracted from the earth there, but rather from countries like Indonesia, Chile or Namibia - from countries that often do not profit nearly enough from the richness of their natural materials. We want to change this," Scholz stated during a recent industrial trade fair in Germany.
Meanwhile, lithium prices and demand continue to soar as the auto industry shifts towards EVs, intensified by proposed bans on fossil-fuel cars, beginning at the end of the decade.
Earlier this year, mines and energy minister Tom Alweendo warned international media that Namibia would soon insist that all lithium mined within the country has to be processed domestically.
Mining analysts believe Africa's lithium production is set to rapidly increase this decade from 40 000 tonnes this year to 497 000 tonnes in 2030. Lithium prices more than doubled last year, as demand from the EV industry outstripped supply.
Moreover, government is working on better ways of providing a clear roadmap for natural resources, such as minerals, to be locally beneficiated to contribute to downstream industrialisation.
For this reason, the Mineral Beneficiation Strategy (MBS) was developed as an inclusive long-term modernisation and economic transformation programme to enable the substantive and sustained raising of living standards, intensifying structural change, and accelerating Namibia's industrialisation.
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At the launching of the MBS in 2021, trade minister Lucia Iipumbu said the strategy aims to facilitate the realisation of full social and economic potential which can be derived from Namibia's vast mineral endowment, and to promote investment, trade and industrial development.
At the time, Iipumbu noted that the absence of such an MBS has been a major handicap for government in the implementation of policies that promote value-addition, particularly in the mining industry.
So-called 'low-hanging fruits', identified as possible short to medium-term viable options for mineral beneficiation and creating feedstock for manufacturing or end-products, include diamonds, copper, zinc, industrial minerals (clays, dimension stone, limestone), and battery minerals (lithium and graphite).
Mining accounts for approximately 11% of Namibia's Gross Domestic Product, providing more than 50% of foreign earnings.
