The Chamber of Mines of Namibia says the mining sector generated N$51.5 billion during the 2023 financial year, contributing N$6.8 billion in taxes including the pay as you earn (PAYE).
The Chamber’s President, Zebra Kasete, said the mining sector’s financial performance demonstrated significant growth, as evidenced by the total turnover which represents a 35.9% increase compared to the N$37.976 billion recorded in 2022.
“Several factors contributed to this growth, including a weaker exchange rate, higher prices for gold and uranium, and increased production of gold, uranium, and diamonds. Moreover, the sector achieved an impressive improvement in overall profitability,” Kasete said.
“In 2023, it recorded a collective profit of N$2.731 billion, a stark contrast to the N$391 million loss reported in 2022. Notably, the collective profit was driven by the exceptional performance of B2Gold’s Otjikoto mine, attributed to higher gold prices, increased production, and lower operating costs.”
Kasete revealed this at the 45th Chamber of Mines Annual General Meeting (AGM) where he retained his position, including the first and second Vice Presidents, George Botshiwe and John Roos, respectively.
He said the Chamber members significantly bolstered the government’s tax revenue in 2023, which grew by 55.9% from N$4.402 billion in 2022 to N$6.861 billion.
This, he said, was primarily driven by the exceptionally high corporate taxes paid to the government which amounted to N$3.967 billion, representing an increase of 98.5%.
“The industry’s robust profitability directly contributed to these high corporate tax payments, underscoring the government’s substantial gains from corporate income taxes when mines reach profitable levels. Additionally, the increased Government revenue was due to an increase in royalties and export levies which grew by 17.6% and 45%, respectively. The higher royalties and export levies were supported by increased production, a weaker exchange rate and higher prices for gold and uranium,” reiterated Kasete.
Furthermore, he said direct employment increased by 12.6% in 2023 to 18,189, from 16,147 in 2022 attributed to the creation of new employment positions resulting from the restart of the Langer Heinrich mine and expansion of other operations.
“Direct employment consisted of 8,950 permanent employees, 803 temporary employees and 8,436 contractors. Every job created by the industry also generates important sources of revenue for the government through PAYE and VAT as a consumption tax,” he said.
“In 2023, employees from mining companies paid N$1.493 billion in PAYE. The majority of individuals employed by the mining sector are Namibians, which consisted of approximately 97% of the mining workforce in 2023. This means that the wage bill of N$6.865 billion circulated within Namibia’s borders and created local spin-offs that support and benefit other sectors of the economy,” he added.
Furthermore, Kasete said N$21 billion was spent on goods and services locally sourced, signifying the continued local empowerment.
“As a proportion of total procurement of N$26.388 billion, 80% was spent on local businesses. Local procurement also constituted 40.9% of the total of the N$51.836 billion in revenue generated by the industry, overall,” he said.
