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Namibia can draw lessons from other oil-producing economies as the country positions itself to ensure a sustainable future.

The country is expected to be among the top 15 oil producers in Africa by 2035, should it stay clear of corrupt practices and mismanagement of natural resources.

Speaking at a public lecture on Preventing the Dutch Disease: How to Position Namibia's Oil and Gas Endowments at Lüderitz organised by the Bank of Namibia, its Governor, Johannes !Gawaxab said new discoveries could potentially double the country's GDP and its output.

Exploration activities have so far contributed to economic growth, estimated at an average of 0.4% between 2021 and 2023.

Contributions are expected to keep rising as exploration intensifies and the development of oil, gas, and green hydrogen is elevated. It could also result in currency appreciation, in turn encouraging imports and discouraging exports in other sectors as they become less competitive.

These issues, !Gawaxab said this could result in resource curse risks for Namibia if left unchecked.

This also means that countries with an abundance of natural resources tend to have less economic growth, less democracy, and worse development outcomes than countries with fewer natural resources.

The Dutch disease is also found to be a contributing factor to unemployment, a paradox where countries rich in natural resources often experience slower economic growth, less democracy, and poorer development outcomes compared to those with fewer natural resources. 

!Gawaxab emphasised that Namibia has the opportunity to learn from other oil-producing countries.

The central bank governor says to avoid the Dutch disease, long-term planning is required by building strong, competent, transparent, and corrupt-free institutions, as well as an appropriate legislative and regulatory framework. 

The oil and gas discoveries as well as the green hydrogen industries are expected to change the socio-economic landscape of Lüderitz.

With Namibia's world-class renewable energy sources, the country is poised to help meet global demand.

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NBC Digital News

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Celma Ndhikwa