In what was widely regarded as an essential step to transform the Namibian Retail sector, stakeholders recently met in Windhoek to advance plans for a negotiated transformational model for that sector. The stakeholders meeting was facilitated by the Namibia Trade Forum (NTF), an agency of the Ministry of Trade and Industry, with the objective to map out the formation of Task Teams, their terms of references, as well as the guidelines to guide the development of the Namibian Retail Charter.
Extensive sector consultations commenced in 2013 through a broad stakeholder consultative meeting lead by Calle Schlettwein, Minister: Trade and Industry, and a ministerial delegation. This latest meeting aimed to bring together retailers and wholesalers representing the segments food and beverages, clothing and apparels, as well as building and hardware, joined by distributors, organised labour, business associations, and regulators. The aim was to create a platform through which these stakeholders could actively impact the proposed plan and process leading up to the development of the Namibian Retail Charter.
Namibian Retail sector
A recent analysis and research of the Namibian retail sector commissioned by the Namibian Competition Commission, highlighted the continuance of the Namibian economy’s reliance on South Africa. And although significant strides have been made since Namibia’s political independence in 1990, there are still key dependencies on Africa’s economic powerhouse. The analysis pointed out that the influence of South African retailers, relative to Namibian retailers, is in fact expanding. The research states that a key aspect of this regional expansion appears to be the vertical integration of major retailers into their own distribution operations. This backward integrated operation, together with their retail supermarkets, is then introduced into the region. This means that the major retailers often control their own distribution operations. This strategy, the study points out, is potentially to the detriment of local Namibian suppliers, producers and manufacturers.
4th National Development Plan (NDP4)
NDP4 sets the framework for transforming Namibia’s retail sector; it mandates the Ministry of Trade and Industry to initiate growth in the manufacturing sector. Subsequently Namibia’s principal national development plan, has identified a need to diversify locally produced commodities, as well as to increase their shelving and availability in the local retail market. The proposed Namibian Retail Charter seeks to create a suitable climate for local contributions to the retail sector’s supply chain as well as to facilitate job creation amongst other growth targets. Lapitomhinda Hashingola, Liaison Officer at NTF, says this will best be achieved through a meaningful dialogue and closer cooperation between the public and private sector. “We are an agency of the Ministry of Trade and Industry. And as such we were mandated to lead the development of the Namibian Retail Charter and to support the process through our Secretariat,” says Hashingola.
Namibian Retail Charter
He emphasises the Namibian Retail Charter alignment with the Ministry of Trade and Industries’ “Growth at Home Strategy/Industrial Policy”, and NDP4. The “Growth at Home Strategy” aims to transform the broader Namibian economy and explicitly designates the development of a retail charter as a key priority action.
In recent years, despite various initiatives, such as the listing agreement between the Namibia Manufacturers Association (NMA) and retailers, local enterprises still face many barriers in listing their products. Hashingola explains that, “Our objective is thus to facilitate the development of a Namibian Retail Charter so as to enable locally produced goods to get greater shelving.” It was agreed that the development be based on broad sector consultations and with focus on challenges such as merchandising Namibian products, minimum local procurement requirements, transparency and fairness, local accounting offices, supplier development programmes, and a clear monitoring system. Appointment to the Task Teams is voluntarily and is based on retail activity in the Namibian economy.
“The Namibian Retail Charter is a voluntary measure, but with binding targets which will help us achieve the transformation we seek,” says Hashingola. It however remains the prerogative of the Ministry of Trade and Industry to implement legal instruments should the “voluntary” route fail to realise the desired aim within a feasible time frame. Hashingola says:”We thus need the retailers’ visible support and active participation in this. Retailers who support Government are fine; and of these we have plenty good examples. Those who don’t, are missing an opportunity to cooperate.”
The Project plan sets the launching of the negotiation phase for October 2014 as well as regular meetings of the Task Teams. Upon completion and sign-off by the signatories in the third quarter of 2015, the Namibian Retail Charter will then be applicable across Namibia. The charter will be reviewed by end 2017 and its requirements are expected to cease at the end of 2030.