National Equitable Economic Empowerment Framework (NEEEF)

The economic situation currently in Namibia is such that a lion's share of 95% of the socio-economic power still primarily resorts with 5% of the previously advantaged Namibian population. This was made possible by socio-economic injustices and imbalances in the pre-independence Namibia which emanated from past discriminatory laws and practices.

Currently, most of the businesses in Namibia are either foreign owned companies with franchises or partnerships in Namibia or with full Namibian ownership but with 100% non-compliance to any existing Affirmative Action Compliance regulations.

The drive of the NEEEF transformation policy was from the beginning very simple; to serve as a corrective measure of the indisputable socio-economic inequality produced by past discriminatory laws and practices. More aptly, to amend the great income disparities that exists in Namibia since independence. The NEEEF regulation is directly anchored in Article 23 (2) of the Namibian Constitution.

Article 23 (2) empowers the Namibian Parliament "...to enact legislations providing directly or indirectly for the advancement of persons within Namibia who have been socially, economically or educationally disadvantaged by past discriminatory laws or practices, or for the implementation of policies and programmes aimed at redressing social, economic or educational imbalances in the Namibian society arising out of past discriminatory laws or practices..." Therefore, NEEEF has a legitimate constitutional basis to promote the welfare of the Namibian people.

The idea behind this provision was to ensure a balance redistribution of wealth and resources in the country.

The NEEEF's intention is to provide a framework within which all private sector initiatives, will be expected to conform to. It is also the aim of NEEEF that the management structures and workforces of businesses in Namibia should reflect the demographics of the Namibian population more accurately.

NEEEF is not a pro-elitist neither pro-blacks (benefiting the rich the black only) as even black people's companies will be required to comply with the NEEEF requirements. It is also not an obtrusion to the Harambee Prosperity Plan (HPP) neither a means to infuse fear among investors and the private sector.

The HPP, inter-alia, calls for equity and "pulling in the same direction (Harambee)" for prosperity and this is what the NEEEF intends to promote through the implementation of the pillars of empowerment while actively guarding against the distasteful tendencies of fronting, property expropriation, window-dressing, elitism, favoritism, nepotism and self-enrichment.

Here are some specific progress on NEEEF:

The objective of the workshop were, inter-alia, to seek confirmation on issues that required a policy position, report on the substantive matters raised during nationwide stakeholder consultations NEEEF and NEEEB and to consider proposals made and interrogate practical implications of the proposals in a Namibian context.  One of the main key amendments made the renaming of the NEEEF to the "National Equitable Economic Empowerment Framework". NEEEF was initially known as the New Equitable Economic Empowerment Framework.

  1. In 2008, Government, with the provision of the Constitution introduced a subset of the policy required to achieve greater equity in the Namibian society. This subset was christened: Transformation Economic and Social Empowerment Framework (TESEF).The document was then submitted to the Prime Minister's Office.
  2. In 2011 TESEF was replaced with the New Equitable Economic Empowerment Framework (NEEEF). This framework has now been translated into a draft Bill (i.e. the National Equitable Economic Empowerment Bill (NEEEB).
  3. In 2015, Cabinet as per decision No. 11th/22.09/001 approved the New Equitable Economic Empowerment Framework In the same year, the Office of the Prime Minister approached the Law Reform and Development Commission (LRDC) to assist in translating the NEEEF into law.
  4. In 2016, the Office of the Prime Minister (OPM) in collaboration with the Law Reform and Development Commission (LRDC) conducted nationwide stakeholder consultations.
  5. A report on issues raised during the nationwide consultation were presented to Cabinet. Cabinet by Decision No. 6th/22.05.18/002 took note of the issues raised during the consultations and authorized the Prime Minister, in conjunction with the Law Reform and Development Commission, to finalize the NEEE Bill and align it to the Framework in its context and language;
  6. Pursuant to the Cabinet Decision, a Working Committee consisting of Office of the Prime Minister, the Ministries of Labour, Industrial Relations and Employment Creation, Finance, Industrialisation, Trade and SME Development, Mines and Energy, Fisheries and Marine Resources, Office of the President was constituted
  7. On 27 February 2018 a decisive Cabinet workshop held at the State House, recommended a number of amendments to the original NEEEF draft to ensure inclusivity and improve on the language and quality of both the Framework and the Bill
  8. Between 2018 to 2019 consultations have been ongoing to finalize the revised draft Bill.

Challenges

A number of challenges that government has recognised as follows:

  • The introduction of the New Equitable Economic Empowerment Framework (NEEEF) policy was welcomed with mixed feelings from the beginning by economic and political protagonists while most optimism was observed from government;
  • The mining sector and several financial entities expressed strong pessimistic sentiments gathered during a series of regional consultations towards the development of the envisaged law and its implementation;
  • Largely, most of the negative sentiments emanated from the lack of a broader understanding of the nitty-gritties of the National Equitable Economic Empowerment Bill (NEEEB), the fear of the assumed property expropriation, the application of score cards and means test, as well as how the procedures of compliance to the Pillars of Economic Empowerment will look like to ensure that the envisaged law is implemented with minimal challenges;
  • There were also strong sentiments that the NEEEF will discourage foreign investors to come to do business in Namibia and thus impacting negatively on Foreign Direct Investment (FDI); and
  • Divergent views by stakeholders on the Framework and the Bill stalled the submission of the Draft Bill to Cabinet.

Way Forward

The revised Bill on "National Equitable Economic Empowerment Framework" was finalised, pending Cabinet approval.