Wealth fund legislation misses target

The plan to establish a permanent legal framework for its Welwitschia Sovereign Wealth Fund faces further uncertainty, with the finance ministry saying the Bill remains under review and that it is difficult to give a precise date for its presentation to Parliament.

The legislation is intended to establish the rules governing how the fund receives and manages resource revenues, when money can be withdrawn and how the fund is overseen. Those decisions will become increasingly important if Namibia begins generating substantial oil and gas income, while the International Monetary Fund (IMF) has said finalising the fund’s rules will be key to managing future resource revenues prudently.

“The bill is still undergoing the necessary review process, which consists of other institutions outside of the Ministry of Finance. As such, it is difficult to speak with precision on the date of tabling. However, the intention of the Ministry remains to table it before Parliament during the current financial year,” the ministry told Market Watch.

The latest response leaves open the possibility that the Bill will not reach Parliament this calendar year. Namibia’s current financial year runs until March 31, 2027, although the ministry has not provided a more specific timetable.

Shifting timelines 

The Bill has been in development for several years. In February 2023, then finance minister Iipumbu Shiimi said the government aimed to table it during the 2024/25 financial year, which ended on March 31, 2025. In August 2026, a Bank of Namibia (BoN) official said the ministry still intended to table the legislation during the course of that year. Simonis Storm Research subsequently expected tabling in October, according to a report published on October 5.

The ministry said the Bill had been amended in response to proposals from various institutions, but that its substance and policy objectives remained aligned with the framework approved by Cabinet.

“As part of the legal drafting process, the bill is amended in line with the proposed changes by the various institutions. So naturally the bill gets transformed during the review process. Nonetheless, the substance and policy intention remains as per the policy framework approved by Cabinet,” it said.

The ministry did not outline the key differences between the 2023 draft and the version now under review, saying it would need to see the specific version being referenced. It also did not confirm whether the revised text would be made publicly available before tabling.

Fund parameters remain blank 

Simonis Storm’s October report assessed the publicly available 2023 draft, identifying unresolved provisions relating to petroleum revenue deposits and withdrawals, as well as questions around governance, audit and oversight. The firm said some key parameters in that version remained blank. It is not yet clear whether those provisions have been addressed in the revised Bill.

Asked whether the outstanding policy parameters had been finalised, the ministry said: “Indeed, by the time the bill is tabled in Parliament, all policy parameters will be finalized.”

The uncertainty comes as questions persist over how the fund will be capitalised. The BoN, which administers the fund, confirmed that no additional capital contributions or deposits had been made since its inception in 2022.

“No additional capital contributions or deposits have been made to the Welwitschia Fund to date. The Fund continues to grow through investment returns generated from the initial seed capital provided at its inception in 2022,” the central bank said.

The absence of additional deposits does not, by itself, establish that any required transfer has been missed. Simonis Storm said publicly available information did not establish whether the fund’s interim administrative arrangements required transfers in 2024 or 2025.

Assets under management

The fund was valued at N$508.47 million at the end of July, according to Simonis Storm. The Bank of Namibia said it had generated an annualised nominal return of 14.9% in US dollars as of the end of September, with performance driven primarily by its exposure to equities, particularly developed-market shares.

The IMF has called for the fund to be integrated into Namibia’s budget process to help prevent additional resource revenues from fuelling wasteful spending. It has also recommended using revenue from the initial phase of oil production to reduce public debt and associated risks, given uncertainty around the timing and scale of future petroleum income.

Namibia has made several offshore oil discoveries, but substantial government revenue will depend on project development, production timelines and the fiscal terms governing the projects.

The finance ministry has reiterated its intention to table the Bill during the current financial year, but has not committed to a specific date.