Northern Kentucky University

SWOT Analysis

Namibia

Asaph Wutawunashe

Foundations of International Business ECO-305

Professor Laub

9/25/2020
 Index

I. Introduction

II. Culture

III. Economic Environment

IV. Political Environment

V. Legal Environment

VI. SWOT Analysis Matrix

VII. Appendix

VIII. Works Cited

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Introduction

Namibia is a Southern African nation with a coastline on the Atlantic and is bordered by

Angola, South Africa, Zambia, and Botswana. Namibia was a German colony which was

occupied after World War 1 and then administrated after World War 2 by South Africa, though

this was not recognized by many countries.

SWAPO, the current governing party, began a guerilla war of independence in 1966 and

this finally culminated in South Africa ending its administration of Namibia in 1990 and granting

the country independence. South Africa’s administration of Namibia meant that many of the

Apartheid-era policies were implemented in Namibia and this has shaped Namibia economically,

socially, and politically.

Namibia is largely desert land though it is rich in resources, which when coupled with the

small population has led to the World Bank designating Namibia an upper middle-income

country. The numbers are misleading as due to the Apartheid system “extreme socio-economic

inequalities…persist, despite generous public spending on social programs.”

(https://www.worldbank.org/en/country/namibia/overview). The Apartheid system was

implemented to mainly benefit the white minority and marginalize the largely black African

majority, which is causing many tensions around income inequality and land ownership.1

1
“The World Factbook: Namibia.” Central Intelligence Agency, Central Intelligence
Agency, 1 Feb. 2018, www.cia.gov/library/publications/the-world-factbook/geos/wa.html.

“Namibia .” The World Bank Namibia, World Bank, data.worldbank.org/country/namibia.

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Culture

Namibia is a diverse country with many different ethnic groups. Namibia has 13 national

languages and 11 different ethnic groups. Approximately 80-90% of the Namibian population is

Christian. Namibians have a well-developed sense of national identity and most do not seek to

emigrate out the country to resettle elsewhere.

Hofstede Insights has given Namibia a 65 power distance score, a 30 individualism score,

and a 40 masculinity score, these scores mean that Namibia is a hierarchical society that

encourages collectivism like many African cultures. Collectivist African cultures tend to put a

focus on the group rather than individuals, they also tend to have large extended families.

Namibia is also considered a feminine society that looks more towards compromise rather than

beating the competition.

Economic Environment

Namibia’s economy has enjoyed stability due to the sound management of the

government. The World Bank has estimated Namibia’s 2019 Gross Domestic Product to be

$12.367bn, its population to be 2,494,530, its Gross National Income Per Capita to be $5,060,

and its Gini coefficient to be 59.1. The economy has shown exponential growth from 2002 to

2018, the African Development Bank attributes this growth to the macroeconomic policies of the

government and strong mining activity.

The Namibian economy has shown stability and resilience, but its high Gini coefficient

is reflective of the Apartheid policies of the past which may be economic and political

flashpoints going into the future, as seen in neighboring South Africa.

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Namibia is part of the Southern Africa Customs Union and the Common Monetary Area,

which means that the South African Rand is legal tender within Namibia and makes trade easier

between the member states.

Namibia’s economy is heavily dependent on the export of minerals, according to country

review, “The nation’s economy is highly dependent on the minerals sector, which accounts for

more than 50 percent of foreign exchange earnings.”. Namibia’s dependence on minerals makes

it vulnerable to fluctuations in the price of those minerals, its dependence is a weakness the

government should look to address. The dependence on the export of minerals or natural

resources without a strategy to reform the economy towards diversification and the export of

high value items will result in the Namibian economy becoming less competitive going into the

future.

2
“Namibia.” Hofstede Insights, Hofstede Insights, www.hofstede-insights.com/country/namibia/.

“The World Factbook: Namibia.” Central Intelligence Agency, Central Intelligence Agency, 1
Feb. 2018, www.cia.gov/library/publications/the-world-factbook/geos/wa.html.

“Namibia Country Review” Country Watch. Country Watch. 1 Jan. 2020, https://web-a-

ebscohostcom.northernkentuckyuniversity.idm.oclc.org/ehost/pdfviewer/pdfviewer?

vid=0&sid=6600bf10-49bc-4cce-8afc-f591e177d0d4%40sdc-v-sessmgr02.

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Political Environment

Namibia has been largely politically stable since independence in 1990. Namibia is a

Presidential Republic with SWAPO being the majority party in parliament. SWAPO has been

dedicated to multiparty democracy and good governance, which has led to economic growth

within Namibia.

Namibia had a few tense years post-independence, in which it faced a secession and

constitutional crisis as people in the Caprivi strip attempted to secede and former President
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Nujoma was threatening to run for a fourth term. Namibia overcame its rocky start to establish

functioning multiparty democracy.

Namibia’s disproportionate land ownership has been a political flashpoint in the past and

continues to be a problem that needs addressing. Colonial and Apartheid era policies have placed

approximately 70% of the land into the hands of the white minority and foreigners. The

Namibian statistics agency estimates that only 16% of the land is in the hands of socially

disadvantaged black locals. The heated debate of land ownership and correcting colonial wrongs

has the possibility of destabilizing the country, as seen with the gains of the EFF in South Africa

and the disastrous program of forceful evictions implemented in Zimbabwe. The government

should seek a solution as soon as possible before the issue becomes uncontrollable.

Namibia is a politically stable country with strengthening institutions. The SWAPO

dominated government has been largely dedicated to democracy and the rule of law, which make

3
“The World Factbook: Namibia.” Central Intelligence Agency, Central Intelligence
Agency, 1 Feb. 2018, www.cia.gov/library/publications/the-world-factbook/geos/wa.html.

“Namibia .” The World Bank Namibia, World Bank, data.worldbank.org/country/namibia

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it a good destination for investment. The Coronavirus pandemic is estimated to contract the

economy by 7.8% as much as estimated by the Bank of Namibia but should see a strong rebound

as borders and the world economy reopens.

Legal Environment

Namibia’s legal system is largely based off Roman Dutch law and has elements of

Westminster style constitutional law, customary law, and international law. The judiciary’s

independence is guaranteed by Namibia’s constitution. The World Bank scored Namibia’s

judicial independence at 5.28 in 2017, which is comparable to that of the United States at 5.51 in

2017. Namibia has a strong and independent legal system but has been blighted by bribery in the

past with Transparency International giving Namibia a 52 out of 100 score on its 2019

Corruption Perception Index.4

SWOT Analysis Matrix

Strengths Weaknesses

1. Strong and independent 1. Small population.

4
Geraldo, Geraldine M, and Isabella Skeffers. “Researching Namibian Law and the
Namibian Legal System.” Researching Namibian Law and the Namibian Legal System -
GlobaLex, www.nyulawglobal.org/globalex/Namibia.html

“Namibia.” Transparency.org, Transparency International,

www.transparency.org/en/countries/namibia.

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 legal system. 2. High dependence on

2. Stable political mineral exports.

environment. 3. High Gini coefficient.

3. Growing Middle Income 4. Lack of innovation.

Economy.

4. High Infrastructure score.

Opportunities Opportunities-Strength Opportunities-Weakness

1. Access to Southern African Strategies Strategies

customs union. 1. Use local production 1. Increase flavors or

2. Access to Common capabilities to directly supply offerings to innovate and

Monetary Area that includes informal sector differentiate from

South Africa. 2. Common monetary and competition

3. Breakage between formal customs union allows access 2. Offer cost saving brand

and informal sector. into South Africa, the most that serves the lower income

4. Large affluent population. advanced economy on the population.

planet.
Threats Threat-Strength Strategies Threat-Weakness Strategies

1. Coronavirus Pandemic. 1. Aggressively use local 1. Champion local production

2. Bribery/Corruption. courts to settle disputes capabilities to avoid targeting

3. Small domestic consumer 2. Tailor corporate message from corrupt politicians.

and labor market. to favor societal economic 2. Implement strategies to

4. Historical socio-economic justice. capitalize on post COVID

disparities may create rebound to capture market

political and economic share.

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flashpoints.

Appendix

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Works Cited

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“Business Law in Namibia.” Business Law in Namibia - Business Environment - Nordea Trade
Portal, Nordea , www.nordeatrade.com/en/explore-new-market/namibia/legal-environment.

“Currency.” Currency - Namibia Tourism Board, Namibia Tourism,

namibiatourism.com.na/page/currency.

“Economic Outlook.” Bank of Namibia - Economic Outlook, Bank of Namibia, Aug. 2020,
www.bon.com.na/Publications/Economic-Outlook.aspx.

Geraldo, Geraldine M, and Isabella Skeffers. “Researching Namibian Law and the Namibian
Legal System.” Researching Namibian Law and the Namibian Legal System - GlobaLex,
www.nyulawglobal.org/globalex/Namibia.html

“Judicial Independence (WEF).” GovData360, World Bank,

govdata360.worldbank.org/indicators/h5ebaeb47?country=NAM.

Mulles, Ineke. “Namibia: Who Owns the Land?” DW.COM, Deutsche Welle, 3 Oct. 2018,
www.dw.com/en/namibia-who-owns-the-land/a-45740852.

“Namibia.” Hofstede Insights, Hofstede Insights, www.hofstede-insights.com/country/namibia/.

“Namibia.” Transparency.org, Transparency International,

www.transparency.org/en/countries/namibia.

“Namibia .” The World Bank Namibia, World Bank, data.worldbank.org/country/namibia.

“Namibia Country Review” Country Watch. Country Watch. 1 Jan. 2020, https://web-a-

ebscohostcom.northernkentuckyuniversity.idm.oclc.org/ehost/pdfviewer/pdfviewer?

vid=0&sid=6600bf10-49bc-4cce-8afc-f591e177d0d4%40sdc-v-sessmgr02.

“Southern African Customs Union.” ** Welcome to the SACU Website **, Southern African
Customs Union, 25 Sept. 2020, www.sacu.int/show.php?id=471.

“The Distribution Network in Namibia.” The Distribution Network in Namibia - Buying and
Selling - Nordea Trade Portal, Nordea, July 2020, www.nordeatrade.com/en/explore-new-
market/namibia/distribution.

“The World Factbook: Namibia.” Central Intelligence Agency, Central Intelligence Agency, 1
Feb. 2018, www.cia.gov/library/publications/the-world-factbook/geos/wa.html.

. “U.S. Relations With Namibia - United States Department of State.” U.S. Department of State,
U.S. Department of State, 15 Jan. 2020, www.state.gov/u-s-relations-with-namibia/.

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