Namibia should not allow officials to pocket oil proceeds

HANS BEUKES WRITES:Dear President GeingobA news item of 22-03-09 quotes you as follow, with reference to the oil discovered off Namibia’s coast:“Legally it is not ours. Legally it is owned by the investors, with 90%, but we are going to get it through taxes and royalties until we nationalise and become socialists, and we do not want that.”I would like to discuss this with you. Because you abjure socialism (however it is defined) you would let investors enjoy what is rightfully the birth right of one and every Namibian – leaving the country in poverty, while those well connected can enjoy ill-gotten gains.Having been a student in Norway, I have had the privilege of observing at first-hand how the people of Norway dealt with the oil discovered off their coast – to leave their poverty behind and become the next richest nation on earth.It began with an American company applying to drill for oil off the Norwegian coast. Believing that «there might be oil down there», Jens Evensen, an official in the foreign office, drafted a Royal Decree that in fact nationalised all resources to be discovered in and under the Norwegian sea (31.05.1963).No mention of socialism, just a pure business-like deed, well understood by the oil business.They next established a regime for dealing with search permits and for the granting of search licenses. And in 1975 they adopted a special act dealing with the taxation of undersea petroleum finds. The special petroleum taxation was motivated as follows: “Because of the extraordinary profitability of petroleum recovery the oil companies, in addition to the ordinary business tax of 22 percent, is subject to an extra tax of 56 percent. Giving a total of 78 percent.”As a condition for the granting of licenses, the government required companies awarded licenses to train Norwegians in all aspects of the oil business. It established an Oil Directorate to provide the state with independent expert information concerning resources offshore, and in the same year (1972) it established a state company (Statoil) to submit applications and be awarded licenses alongside the oil giants.This company depended heavily on foreign experts. As did the Oil Directorate which engaged an Iraqi specialist on his way through Oslo to the US to analyse for them the bore specimens that the companies were obliged to deposit, and then employed him.The extraordinary income from the oil taxes and the state&#039;s own production would have wreaked havoc with the Norwegian economy, and society, if it had been allowed to be spent indiscriminately. “The best we can do with the money”, said a conservative politician, “is to invest it and forget about it”. The clamour about the use of the money died down and a State Oil Fund was established which today is the second largest in the world. With strict rules for how much of the annual income from oil may be used in the ordinary budgeting.From the income generated by new businesses springing up all along the coast every part of the nation benefited, the universities offered courses in petroleum related subjects and law courses in Petroleum Legislation and Petroleum Contracts. Poverty was fairly wiped out.Now Mr President, as you are no doubt aware, in 1974 the United Nations Council of Namibia, “desirous of securing for the people of Namibia adequate protection of the natural wealth and resources of the territory which is rightfully theirs” adopted a Decree to give effect to that.Would you call that a socialist action (something anathema to you I understand) on the part of the international community, Mr President, and would you say it was repudiated by the Constitution for Namibia that was subsequently drawn up? This reminds me of a criticism of the Namibian constitutional process levelled by my late father, Hermanus Beukes, that it was done without the participation of the people.This brings me to the treatment of the other natural resources of Namibia – the diamonds, the stones, the fish, the woods, the game – where officials enrich themselves with handouts, while the investors get away with the lion&#039;s share.How much has the country lost – while officials have been pocketing proceeds, and the lives of the majority of the people remain miserable? What do you do when young children in Windhoek stick out their hands in supplication, or does your circumstance save you from ever encountering that?

Namibia should not allow officials to pocket oil proceeds

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Republikein 2025-12-15

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Namibia should not allow officials to pocket oil proceeds

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