Marine phosphate mining: prosperity or bust?

By Penda Jonas Hashoongo
August 2016
Editors Note

Namibia’s extractive sector is renowned the world over; with specific reference to its supply of fish and oysters which find themselves in markets as far wide as Europe and Asia, not to mention the country’s contribution of about 8% of the world’s uranium.

Namibia’s diamonds meanwhile, have made the country synonymous with high quality diamonds stemming from the times of Zacarius Lewala. This notwithstanding, it would appear that the extractive sector has greater potential to add to the country’s GDP, if the proponents for the mining of phosphorus rock, which is nestled at the bottom of the country’s seabed, are to be believed.

While the prospect of Phosphate mining in Namibia came as a gold-plated concept in the onset, optimism in this regard appears to have dwindled to the extent that people are now asking whether it is really an endeavour that would benefit the entire country or only one that would help to bolster the pockets of a few affluent individuals along with their external investors who have moulded entire industries out of the exploitation of developing countries (although Namibia is no longer classified as such) and their natural resources.

The 18-month moratorium that was placed on the issuance of licences for Marine Phosphate Mining pending concrete investigations into the effects these activities could have on the other extractive sectors such as fisheries was undoubtedly the best course of government could have taken to ensure that the country is not short-changed in the process of adopting the newest member of its extractive family.

There have been conflicting reports about the scarcity of phosphorus (which is the main component that prospective companies will be mining for underneath the seabed once or if the Ministry of Mines and Energy finally gives the go ahead for this type of mining) the world-over, with some suggesting that there is a definite need to augment the production efforts of the element that is primarily used for making fertilizer, while its bi-products can be used in construction instruments such as cement. Other reports purport that the majority of the world’s phosphorus is yet to be extracted from the earth. It is upon these reports that doubt over the hasty nature in which Namibian companies interested in undertaking this type of mining are pinned.

The simple economic principles of scarcity, demand and supply also need to be taken into consideration when considering how Phosphate mining could benefit the country. If the reports suggesting a decline in the availability of Phosphorus are true, then it would truly be in the best interest of the country to put off the mining of this commodity until such a time that it becomes so scarce that the rest of the world would pay top dollar to acquire the Phosphorus available in Namibia. A situation like this would enable other extractive sectors such as Fisheries to continue undeterred, while also allowing the companies interest in Marine Phosphate mining to setup essential value chains in the country that would contribute to employment creation, while simultaneously adding value to the Phosphorous being mined to the extent that it is exported as a finished as a packaged or finished commodity, rather than in its raw form, which is exactly what would happen if the Marine Phosphate Mining operations commenced tomorrow.

The recurring theme in the consideration of Marine Phosphate Mining is the need to get the most out of this valuable commodity. Unfortunately at this juncture, the question that punctuates this need is, ‘for who’? Who stands to gain the most from Marine Phosphate Mining at this moment in time? Is it the entire country that would benefit from the endeavour or is it merely a simple portion of the country? Is this not something that would go against the principle of making sure that most Namibians can benefit directly or at the very least indirectly from the mining of this commodity?; These are the questions that those tasked with considering the future of Marine Phosphate Mining in Namibia should be asking themselves. Another important component to consider is the long-term effects that Marine Phosphate Mining will have on the aquatics since 18-months is not an adequate amount of time to make a concrete conclusion on what would happen five years into the operations of Marine Phosphate Mining.