By Wezi Tjaronda WINDHOEK The manufacturing sector needs to increase its share of the Gross Domestic Product (GDP) to 30 percent for Namibia to achieve its targeted economic growth of 7 percent. The concern remains that the current 10.7 percent that the sector contributes is lower than what is needed for the country to achieve its developmental goals as stated in the country’s road map – Vision 2030. The Vision 2030 document expects the manufacturing and services sectors together to contribute 80 percent of Namibia’s GDP, and the export of largely processed goods to account for not less than 70 percent of Namibia’s total exports. But since 16 years ago, Namibia has had very little industrial growth, so much so that it continues to import most manufactured products, mainly from neighbouring South Africa, because the sector is characterized by structural weaknesses and operational constraints that include high input costs relating to electricity, transport and port charges. “The manufacturing sector has an unusually low share of Namibia’s national output, employment and exports compared to countries such as Singapore, South Africa and Ireland,” says a summary paper, “Assessing the Potential of the Manufacturing Sector in Namibia”. The report, compiled by the Research Department of the Bank of Namibia, was to identify and assess potential products within the sector that could increase growth and also to suggest possible policy options to increase manufacturing output to achieve the goals of Vision 2030. The bank conducted research and field surveys with selected government ministries and agencies, the private sector and 26 manufacturing companies in Windhoek, Arandis, Swakopmund and Walvis Bay. The study identified high input costs, availability of quotas for the fishing industry, low throughput for the meat processing industry and unfair competition from well-established South African companies as some of the constraints facing the local manufacturing sector. Other problems facing the sector include a small domestic market, which leads to the lack of economies of scale, low levels of productivity, the negative impact of HIV/AIDS, lack of advertising opportunities for Namibian manufacturers, unavailability of highly skilled personnel and the processing of and acquiring of work permits. The BoN paper identified new products which Namibia could consider producing, including plates, pencils, desk chairs, large-scale tiles, marble, granite, karakul pelts, mineral water bottles, processing Devil’s Claw, cassava for fuel production, metal products, auto components, unique wood, palm and clay, ready-made fish meal and leisure garments and many others. Yesterday, the Namibian Manufacturers’ Association held a workshop to develop a Marketing Strategy for Namibia. The terms of reference for the strategy were developed by the NMA and approved by the Office of the Prime Minster and the Trade and Industry minister last year. Prime Minister Nahas Angula yesterday expressed concern over Namibia’s inability to diversify its economy by creating new industries in the secondary sector. He said Namibia faced high unemployment, which could be attributed to capital-intensive production and lack of a value chain. “A value chain is created through value addition. Value addition creates a chain of activities, which create more employment. At the same time, the value chain enables a country to derive benefits from its products,” said Angula when he opened the workshop. He added that more people would derive benefits from production processes if more people earn an income and also lift themselves out of poverty. He said problems were rife, yet Namibia exports both raw materials and capital and although mining contributes significantly to the GDP and government, minerals are exported in the form of concentrates, yellow or in barely processed form. Some of the constraints that the PM said should be investigated, as Namibia forges ahead in creating a vibrant secondary industry, are the availability of a framework or infrastructure for technology leveraging, the provision of necessary support for market research and development, a competition regime to protect infant industries and the availability of managerial and administrative capacities to develop a competitive manufacturing sector. According to the bank’s study, products that Namibia could use optimally that are already being exported elsewhere are tiles, slabs, monuments, grave stones, tables, beds, cupboards, school and office furniture, beer, carbonated soft drinks, meat-packing marking machines, dairy products, mineral water, fruit juices, steel windows, door frames and aluminium windows. Other products are maize-meal and hoodia, automotive and washing-machine parts, field shoes, tin cans, packaging material and salt.