- Title
- Economic diversification and socio-economic development: a case of Namibia
- Creator
- Fikunawa, Brigitte
- Subject
- Diversification in industry
- Subject
- Economic development -- Namibia
- Subject
- Namibia -- Economic conditions
- Date Issued
- 2024-12
- Date
- 2024-12
- Type
- Doctoral theses
- Type
- text
- Identifier
- http://hdl.handle.net/10948/70264
- Identifier
- vital:78334
- Description
- Economic diversification has been at the forefront of many countries’ socio-economic development agendas, especially resource-rich developing countries. It is seen as a tool for attaining socio-economic development. After independence as a strategy to resolve socio-economic challenges, most developing economies like Namibia implemented policies and strategies enabling economic diversification. This study provides an empirical analysis of Namibia’s economic diversification and socio-economic development between 1990 and 2021. The study used a concurrent mixed research methodology involving quantitative secondary and qualitative interview-based primary data to assist in filling any gaps left by either methodology. The interviews helped expand and validate the secondary data results. The quantitative component of the study focuses on determining the level of economic diversification, the drivers of that diversification and the effect of economic diversification on socio-economic development. The study used the Tress and Ogive indices to proxy for economic diversification, while employment, poverty reduction and economic growth represent socio-economic development. Reading from these economic diversification measures, Namibia’s economy is relatively diversified but remains in the initial stage, with Tress and Ogive indices levels of 48.09/6.03. The study also found that in the long run, foreign direct investment (FDI), education and institutional quality lead to increased economic diversification while inflation discourage economic diversification. In the short run, FDI and education enhances diversification while inflation, financial sector development and earnings from natural resources lead to a decline in economic diversification. In examining the effect of economic diversification on socio-economic development, the results show that it has a positive influence on employment creation, poverty reduction and economic growth in the long and the short term. So overall the study found that economic diversification contributes positively to socio-economic development. To validate the quantitative results, six senior executives from five entities which includes ministries, government agencies and the private sector were selected purposively for interviews on their perception of economic diversification in Namibia and the data were analysed thematically. The results were inconclusive with regard to the effectiveness of the enabling policies. The participants agreed the enabling policies had contributed to employment, poverty reduction, income equality and economic growth. However, more needs to be done, like creating value chain-connected sectors that create seasonal employment, for the contribution to be sustainable. The study also found that the cost of doing business (mainly taxation and the cost of water and electricity); policies and institutional frameworks (like immigration, trade and investment laws); competitiveness of the economy in terms of its size, quality of human capital, manufacturing capacity and economic uncertainty are the leading challenges affecting the progress of Namibia’s economic diversification process. This researcher drew up several recommendations for the Namibian government to continue enhancing economic diversification to address the socio-economic challenges of unemployment, poverty and income inequality through investment in productive areas of the manufacturing and services sectors which can contribute to growth and employment. The government also needs to address the challenges hindering the progress of economic diversification in the country to create an environment that can foster economic diversification. The study recommends targeted intervention to enhance the attractiveness of other sectors so as to wean the economy off its high dependence on the primary sector through the provision of both fiscal and non-fiscal incentives. The required human capital development should be harnessed through investment in capabilities like vocational skills that are needed for economic diversification and socio-economic development to be achieved. Good governance should be attained by fighting corruption to enhance investment confidence. It further recommends that Namibia ratifies and implement the SADC protocol on trade and the African Continental Free Trade Area (AfCFTA) agreement to increase market accessibility and address the country’s market size, which is currently uncompetitive for investment.
- Description
- Thesis (PhD) -- Faculty of Business and Economic Sciences, School of Economics, Development and Tourism, 2024
- Format
- computer
- Format
- online resource
- Format
- application/pdf
- Format
- 1 online resource (338 pages)
- Format
- Publisher
- Nelson Mandela University
- Publisher
- Faculty of Business and Economic Sciences
- Language
- English
- Rights
- Nelson Mandela University
- Rights
- All Rights Reserved
- Rights
- Open Access
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Collections
NMU School for Economics, Development and Tourism
| Thumbnail | File | Description | Size | Format | |||
|---|---|---|---|---|---|---|---|
| View Details Download | SOURCE1 | FIKUNAWA, B.pdf | 3 MB | Adobe Acrobat PDF | View Details Download |