The discovery of oil and gas in Namibia has raised prospects for economic growth, but Mines and Energy Minister Tom Alweendo has warned that this is not a guarantee that the nation's socio-economic problems will be solved.
Speaking at the oil and gas conference here on Wednesday, Alweendo said that mismanagement of the oil and gas sector can lead to inequality and corruption, which in turn will exacerbate social unrest and jeopardise political stability.
“We also need to be cognisant of the socio-political and economic complexities that can arise because of an oil discovery and the subsequent production. While potential significant oil investments are expected to flow into Namibia, it is not a given that prosperity will follow,” he said.
Prosperity will follow only if the investments and the consequent oil revenue are well managed. If not well managed, the subsequent result could well worsen socio-economic challenges, Alweendo said.
He added that Namibia should learn from some oil-producing nations whose oil production has not resulted in broad-based socio-economic development.
“The duty is on us, especially those of us who are entrusted with the public responsibility to manage the sector, to ensure that the sector is managed in the best interest of the country for the benefit of not only the current generation but, importantly, for the generations to come,” he said.
Good governance in the sector requires concerted collaboration from various stakeholders.
The minister stated that in order to manage oil and gas resources effectively through sustainable extraction, the government must set forth clear national goals.
“It is also important that the investing companies in the sector play their role in such a manner that the economic benefits to be derived from the sector are shared fairly and equitably,” Alweendo said.
In the past 18 months, large international oil companies have found significant crude oil in Namibia's Orange Basin, which is thought to be the largest oil discovery in sub-Saharan Africa.
Source: The Namibia Press Agency