The Namibian Government has initiated the Special Industrialisation Programme (SIP) as a vitally necessary intervention to bring about an urgent transformation of the economy in terms of production and trade relations. Critical to this intervention is the need to increase the contribution of the manufacturing sector to GDP and thereby create a healthy balance of payments.

The 1998 figures show that Namibia’s total imports amount to some N$10 billion as compared to N$8 billion in exports. This represents a deficit of more than N$1 billion in the country’s balance of payments. Hence the urgent need for the country to produce the basics of what it consumes, through manufacturing for both local and export markets. Manufacturing activity is key to the creation of sustainable jobs and poverty alleviation.

Among the identified areas of manufacturing activity to produce a broad array of consumer, intermediate and capital goods are:

• Food processing and other agro-industries.
• Leather and leather products.
• Textiles and apparel.
• Wood and wood products.
• Production of construction materials, such as cement.
• Cutting and polishing of semi-precious stones and jewellery.
• Paper products and stationery.
• Electrical and electronic appliance products.
• Motor vehicle components.
• Mineral beneficiation.

Government’s intervention to give a push to this industrial development is as follows:

• Provision of industrial infrastructure.
• Equity participation, where necessary, in new manufacturing operations to ensure their successful take-off.
• Support for joint ventures and partnerships between local and foreign investors by securing equity for Namibians.
• Creation of mechanisms that give priority in government procurement to locally manufactured products and long-term contracts to locally based manufacturers.

In pursuit of the objectives of the Special Industrialisation Programme, the Government intends to remain within the bounds of international practice regarding preferential public procurement. For example, a 15% preference in local bidding for civil works is standard practice in World Bank-supported programmes.