Development Bank of Namibia (DBN) Erongo Portfolio Manager, Simeon Unotjari Kahona, has announced that the Bank is seeking opportunities to stimulate more demand for finance in the Erongo region.
In terms of the Bank’s additional focus on infrastructure and business projects, identified in the Harambee Prosperity Plan (HPP), the Bank will seek out projects promoted by private entrepreneurs, through public private partnerships (PPPs), as well as projects identified by the regional council and local authorities. However the Bank will also seek to finance projects that are unique to the economy of the Erongo region.
Talking about the requirement for energy, noted in HPP, Kahona says that the Bank has advanced N$280 million to Erongo RED to ensure supply of electricity, financing was also advanced for Arandis solar project and is also engaged in project finance to secure bulk fuel supply for Namibia.
Among the additional projects that the Bank envisages financing are local authority projects, through PPPs, to develop serviced land, for affordable housing. Kahona adds that the Bank will also finance social infrastructure in Erongo, noting that economic development should walk hand-in-hand with socio-economic development, if greater levels of economic activity are to be of benefit to citizens of the region.
Kahona also says that the region has the potential to strengthen its own internal economy to serve the needs and wants of its enterprises. The Bank believes there is more opportunity to finance light engineering industry that services marine enterprises and the transport and logistics sector, the developing energy sector, and the marine products processing subsector. These projects should have an annual turnover, or projected annual turnover, of N$10 million or more.
In terms of local consumer demand, Kahona announced N$25 million in finance for local food manufacturing, for African Deli, an enterprise established to manufacture instant meals with an African flair. This, he says, shows that there is potential in Erongo to fulfill regional demand, that can extend nationally and further into the SADC market.
Kahona concludes by saying that Erongo is a region that keeps on giving to Namibia’s national economy, and the Bank treats it as a gateway for development in light of this. In the period between 2004 to January 2017, the Bank has provided more than N$4,4 billion in finance to the region. In line with its national gateway status, the majority of that finance, N$3,3 billion was allocated to transport and logistics. This was followed by allocation of N$451 million to the electricity sector and N$197 million to business services.
Development Bank of Namibia (DBN) Senior Communication Manager, Jerome Mutumba, has announced that a team from the Bank will be visiting Otjozondjupa to stimulate demand for finance in the region, as well as to visit DBN customers. The team will be led by DBN CEO Martin Inkumbi.
DBN recently announced its additional focus on infrastructure and business projects which are aligned to the pillars of the Harambee Prosperity Plan (HPP). The visit is intended to shed further light on opportunities for finance for the sectors, which include energy, water, transport, and ICT. The Bank will seek to finance projects in these sectors, promoted by private entrepreneurs, through public private partnerships (PPPs), as well as projects identified by the regional council and local authorities.
Talking about the value of development finance for Otjozondjupa, Mutumba says that the region has the potential to become a hub of economic activity and a major source of value to the economy of Namibia. He says that not only does the region act as a link between the productivity of Erongo, Khomas and the northern regions, but it also has the potential to provide goods and services for the regions around it.
He cites the example of Ohorongo Cement, in which the Bank holds shares. Although conventional wisdom would seek to place a large manufacturing enterprise such as Ohorongo in the Khomas or Erongo Regions, the company uses the central location of the Otjozondjupa Region to reach multiple regions with a reduced logistical chain, and makes use of the local resource. This, in turn, has stimulated the region with employment, and associated economic activity.
Mutumba adds that the region has the potential to strengthen its own internal economy to serve the needs and wants of its inhabitants. The Bank, he says, is also seeking to finance Otjozondjupa projects with an annual turnover of N$10 million or more in the fields of manufacturing, transport and logistics, and tourism.
The Bank is targeting Otjozondjupa loans for agri-processing, tourism, and manufacturing enterprises that will create mass employment.
In the period between 2004 to January 2017, the Bank provided N$615 million in finance to the Region. The largest allocation went to Otjozondjupa’s manufacturing sector, at N$243.36 million, which includes Ohorongo cement. This was followed by N$187.4 million for construction, and N$145.1 million for electricity. The allocation to electricity includes the successful Omburu Sun project, which pioneered solar energy production through the independent power production model that is currently being rolled out across Namibia, as well as its sister project, Osona Sun.
The Bank will conduct information sessions to familiarize stakeholders on its activities, and how to apply for larger enterprise finance. These will take place on Monday, 27 February, at Okahandja Country Lodge, from 16h00 - 17h00, Tuesday 28 February at Out of Africa in Otjiwarongo, from 11h30 - 13h30, and Thursday, 2 March at Peace Garden Lodge in Grootfontein from 11h30 - 12h30.
Development Bank of Namibia (DBN) CEO, Martin Inkumbi, has announced that the Bank is prioritising infrastructure and business projects which are aligned to the pillars of the Harambee Prosperity Plan (HPP).
The priority infrastructure areas, to which the Bank may contribute with finance, are energy, water, transport and ICT. The Bank will consider projects in these areas, promoted by private entrepreneurs, through public private partnerships (PPPs), as well as public institutions such as SOEs.
He illustrates the difference by pointing to finance for Erongo RED to secure power supplies at the coast as an SOE, and finance for Omburu Sun Energy as a utility owned and operated by a private sector entity.
Inkumbi says the prioritisation is not a shift away from the Bank’s focus on key sectors identified by National Development Plan 4 (NDP4), but an additional focus for the Bank. The Bank will continue to provide finance for larger enterprises, with annual turnovers of more than N$ 10 million, in the key NDP4 sectors of manufacturing, transport and logistics, and tourism.
He adds that the Bank’s historical track record closely matches the requirements of HPP. The Bank, Inkumbi says, has been active, since inception, in HPP priority areas such as social progression (the 3rd Pillar of HPP) through financing the delivery of serviced land and housing, and improvement and expansion of education and health services, through finance to private educational institutions and private medical services providers.
Talking about other aspects of transformation entailed in HPP, Inkumbi says although the Bank seeks returns to sustain its activities through repayment of finance with interest, as well as capital preservation through the requirements of collateral and /or guarantees, it also contributes to socio-economic transformation through its corporate social investment programme without expectation of returns.
Asked about financial sustainability in light of the current realignment of fiscal resources by the Government, Inkumbi says the Bank is one of the agencies that can fill the temporary gap in provision of finance, provided that projects are in line with the focal areas of HPP.
He goes on to say that project planning and implementation timelines, justify immediate contact with the Bank. The Bank has its own processes and expertise for assessment of large scale infrastructure. By approaching DBN early, project initiators can ensure that financial resources are available, when required, and that the Bank can assist with risk mitigation with the experience that it has developed through financing multiple large-scale projects and enterprises over the years.
Inkumbi concludes by saying that the Bank provides access to services not just in Windhoek, but also in the hub economic centers of Ongwediva and Walvis Bay. He encourages project initiators to make use of DBN’s open doors to further Harambee with projects that fall within the Prosperity Plan’s focal areas.