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The myths of land and prosperity in southern Africa

The myths of land and prosperity in southern Africa

By Karl Lichtenberg, Consultant and Scholar.

Cyril Ramaphosa, the President of South Africa in an interview with The Economist on October 13th alluded to land being part of the solution to that country’s extreme inequality and poverty.

In South Africa, as in Namibia, when it comes to elections, there is bound to be a lot of senseless talk about expropriation in general and land in specific. While it can not be disputed that there were injustices committed in the past, also with regards to land, there needs to be clear thought on how inequality, unemployment and poverty can be overcome today.

What President Ramaphosa and politicians/parties in Namibia still have to realise is that if they talk about ownership of land as a means of equity and wealth, communal areas and even resettlement farms in Namibia are in no way allowing those that work on the land to gain wealth or equity because they are not the owners.

Talking about the expropriation of commercial farmland means there has to be just as serious thought on how to give people ownership to land in communal areas. This would essentially end traditional life as we know it in communal Namibia. Communal areas in Namibia also debunk the fact that land is a good source for generating income. While a lot of people in communal areas have access to land, the population in those areas remains mostly poor and a lot of people still leave to seek employment in the commercial areas.

Essentially communal areas in Namibia still are feudal societies that stunt economic development, just like they did in Europe before the industrial revolution. While it is true that the ownership of land can be a great source of wealth, this is only true if said land is sold. Especially in Namibia, land will never be able to generate sizeable income streams for extended periods of time for large parts of the population. Yields per hectare are simply too low.

Resettlement in Namibia, as it has been undertaken since 1991, has failed dismally in improving the economic lives of the poorest of our citizens. Even for those benefiting, it has yielded little tangible improvements in day to day life. Since the inception of the resettlement program almost N$1.9 billion were spent to resettle 5300 beneficiaries on close to 3.2 million hectares. That means around 600 hectare per beneficiary. Everybody who knows our country knows that it is impossible to successfully farm on 600 hectares. It also means that the programme came at a per capita cost of more than N$350,000.

Money that could have been spent to have a much greater impact. Even if that money had been given as a cash benefit the outcome would have been better. Given freedom to decide, individuals are more able than government to make efficient investment decisions that suit their needs best. The resettlement program also did not change the beneficiaries lack of assets as land is still owned by the government. It makes no sense whatsoever, that people farming on resettlement farms have no ownership of that land, if it was as important of an asset as politicians are stipulating.

Most of the wealth that farmers have is locked in the ownership of said farmland. So why would we keep resettlement farmers from owning the land if we really cared about creating wealth? Instead of wasting the money on farmland government could have invested it to support the establishment of small businesses or other meaningful ways to create broad employment.

As the current dire situation shows, feet were dragged on employment creation and poverty reduction while senseless talk about land prevailed. We need industrial jobs, that offer a decent wage. There is not enough land to go around to solve our deep-rooted problems of high unemployment. We need to create a spirit of entrepreneurship and endeavour to empower people to depend on themselves and their capabilities instead of waiting to win in the “land lottery”. We have wasted time and money, not improving life for the poorest Namibians for 29 years now and time is running out.

The need for drastic reforms is becoming ever more obvious. We need politicians who have the courage to implement radical reforms, rather than waste our time by bickering over land.

Land, to be more specific, farmland in South Africa as in Namibia has been used by the ruling elites endless times to divert attention from the real problems, namely them being unable to prevent the looting and capturing of the state or actively participating in it, while being unable or unwilling to solve or biggest problem: That more than 30% of our population lacks a decent job and income and as a result has no real future to live for.


 

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Following reverse listing, public can now acquire shareholding in Paratus Namibia

Promotion

20 February 2020, Windhoek, Namibia: Paratus Namibia Holdings (PNH) was founded as Nimbus Infrastructure Limited (“Nimbus”), Namibia’s first Capital Pool Company listed on the Namibian Stock Exchange (“NSX”).

Although targeting an initial capital raising of N$300 million, Nimbus nonetheless managed to secure funding to the value of N$98 million through its CPC listing. With a mandate to invest in ICT infrastructure in sub-Sahara Africa, it concluded management agreements with financial partner Cirrus and technology partner, Paratus Telecommunications (Pty) Ltd (“Paratus Namibia”).

Paratus Namibia Managing Director, Andrew Hall

Its first investment was placed in Paratus Namibia, a fully licensed communications operator in Namibia under regulation of the Communications Regulatory Authority of Namibia (CRAN). Nimbus has since been able to increase its capital asset base to close to N$500 million over the past two years.

In order to streamline further investment and to avoid duplicating potential ICT projects in the market between Nimbus and Paratus Namibia, it was decided to consolidate the operations.

Publishing various circulars to shareholders, Nimbus took up a 100% shareholding stake in Paratus Namibia in 2019 and proceeded to apply to have its name changed to Paratus Namibia Holdings with a consolidated board structure to ensure streamlined operations between the capital holdings and the operational arm of the business.

This transaction was approved by the Competitions Commission as well as CRAN, following all the relevant regulatory approvals as well as the necessary requirements in terms of corporate governance structures.

Paratus Namibia has evolved as a fully comprehensive communications operator in Namibia and operates as the head office of the Paratus Group in Africa. Paratus has established a pan-African footprint with operations in six African countries, being: Angola, Botswana, Mozambique, Namibia, South Africa and Zambia.

The group has achieved many successes over the years of which more recently includes the building of the Trans-Kalahari Fibre (TKF) project, which connects from the West Africa Cable System (WACS) eastward through Namibia to Botswana and onward to Johannesburg. The TKF also extends northward through Zambia to connect to Dar es Salaam in Tanzania, which made Paratus the first operator to connect the west and east coast of Africa under one Autonomous System Number (ASN).

This means that Paratus is now “exporting” internet capacity to landlocked countries such as Zambia, Botswana, the DRC with more countries to be targeted, and through its extensive African network, Paratus is well-positioned to expand the network even further into emerging ICT territories.

PNH as a fully-listed entity on the NSX, is therefore now the 100% shareholder of Paratus Namibia thereby becoming a public company. PNH is ready to invest in the future of the ICT environment in Namibia. The public is therefore invited and welcome to acquire shares in Paratus Namibia Holdings by speaking to a local stockbroker registered with the NSX. The future is bright, and the opportunities are endless.