Putting the Infant Industry Protection (IIP) into perspective

By Penda Jonas Hashoongo
August 2015
Editors Note

The effects of the Infant Industry Protection (IIP) are often misconstrued as adverse, or at the very least, designed to punish the poor, who already find it difficult to put food on the table.

The dairy, cement, poultry and meat industries have all been beneficiaries of the Infant Industry Protection which has served as a catalyst for Namibian products, in the long run, to compete against products from beyond our borders that have benefitted immeasurably from the conditions that existed before the country developed these industries.

The notion that it’s wrong for consumers to be paying slightly more for Namibian products because they are produced here and thus do not have the additional charges associated with importation is, in my view, short-sighted.

To put this in context, when Namib Poultry Industries (NPI) was established, it was met with the same protection measures that other infant industries received, such as the limiting of the chicken products being imported into the country so as to afford NPI enough shelf-space to compete. Since the local chicken industry had only just commenced its operations, an unrealistic demand for chicken products then arose, which caused the prices of chicken products to soar beyond the normal threshold.

The same challenges were experienced in the dairy sector where local milk products were more expensive than the imported products. It goes without saying that every industry where the IIP has been implemented has seen an increase in product prices. From a consumer standpoint, the concerns are justified.

On the other hand, Namibia has a long term plan to become an industrialised nation and it makes little sense how this can be attained through a reliance of imports, particularly of products that can be manufactured locally. The rationale behind supporting the abovementioned industries is not only so the country can realise the ambition to industrialise, but it also plays into the alleviation of poverty, which has been key focus for the current administration, through the creation of jobs.
Affording local industries the leeway to grow may undoubtedly force consumers to dig a little deeper into their pockets to buy these locally produced products, but the advantages that arise therefrom are immeasurable. As consumers, supporting these local industries to get a foothold in their respective sectors will mean that we will be in a position to buy the same products, a decade from now, at a lower price compared to the imported products owing to the fact that once established, the costs associated with getting these products from their factories to the shelves, will be a lot less when juxtaposed to those imported products.

In conclusion, the next time you find yourself in a grocery store faced with the dilemma of whether you should buy locally produced milk or other reputable international brands, let the need for Namibia’s industrialisation and the role you can play in that process guide you to the right decision.