99371 COUNTRY HIGHLIGHTS NAMIBIA 2014 The World Bank interviewed a representative sample of the private sector in 3 of the most active economic regions in Namibia. The sample consisted of 580 business establishments surveyed from April 2014 through February 2015. The Enterprise Survey (ES) covers several topics of the business environment as well as performance measures for each firm. Below are the main highlights from the survey. Namibia’s private sector experienced strong employment growth Employment growth reached the annual rate of Annual employment growth (%) 12 12 9.6% in Namibia between 2011 and 2013. This is larger than the average for African countries with 10 10 comparable data (6.7%), the average for upper middle income countries (7.7%) and the global 8 8 Percentage Percentage average of 5.5%. Smaller firms and those in manufacturing exhibited the highest annual 6 6 employment growth. In particular, small firms 4 4 (between 5 and 19 employees) increased employ- 2013 NAMIBIA ENTERPRISE SURVEY ment at an annual rate of 10.9%, while medium (20- 2 2 99 employees) and large firms (100 employees or more) averaged about 4% growth. Manufacturing 0 0 firms grew at an average of 12.2% annually Namibia2014 Namibia2006 Small(5-19) Medium(20-99) compared to 9.3% for services. Africa Upper middle income Large(100+) In Namibia, more women are engaged in the formal private sector at all levels Firms with a female top manager (female-managed Percent of firms with a female top manager firms) in Namibia constitute 27% of all firms, 30 30 exceeding the average for Africa of 15% as well as 25 25 the average for economies with similar income levels at 17%. The percentage of female-managed firms is 20 20 Percentage very similar across different sizes and sectors. In Percentage 2013, women led 28% of small firms in Namibia vs. 15 15 24% and 22% of medium and large firms, 10 10 respectively. Employment of female workers is also relatively high in Namibia with females constituting 5 5 34% of total workforce, up from 27% in 2006 and 0 0 marginally higher than the African average of 28%. Small(5-19) Namibia2014 Africa Medium(20-99) Upper middle income Large(100+) Customs clearance takes longer for smaller firms On average, in 2013 it takes a firm about 8 days to Days to clear direct exports through customs clear direct exports through customs, more than 12 18 in 2006 (2 days). Despite this increase, the average 16 time to clear customs is still about the same as in the 10 14 upper middle income economies and lower than in 8 12 Africa (10 days). However, there is a wide variation across firms’ size. It takes on average 17 days for 10 Days Days 6 small firms to clear exports through customs, 8 compared to around 6 days for medium sized firms 4 6 and about 2 days for large firms. Clearing imports 4 through customs is considerably faster in Namibia (5 2 2 days) than the average for upper middle income 0 0 economies (11 days) and Africa as a whole (17 days). Small(5-19) Medium(20-99) Namibia2014 Namibia2006 Africa Upper middle income Large(100+) Access to finance in Namibia appears to be less of a challenge compared to 2006 In 2013, 34% of firms in Namibia used banks to 30 250 finance investments, more than three times the percentage in 2006 and roughly twice the average for 25 200 African countries. Furthermore, the proportion of investment capital financed by banks also increased 20 Percentage 150 Percentage with the average firm financing 26% of fixed asset 15 purchases with bank funding. This is significantly 100 higher than the corresponding figure for Namibia in 10 2006 (16%) and on average for African countries 50 (10%). Firms also face far lower collateral 5 requirements than in the past (92% of loan amount in 2013 vs. 219% in 2006) and lower than the average for 0 0 Proportion of investments financed by Value of collateral needed for a firms in Africa (181%). banks (%) loan (% of the loan amount) Namibia2014 Namibia2006 Africa Upper middle income Namibia’s electricity supply is generally reliable The average total time of power outages has worsened 2013 NAMIBIA ENTERPRISE SURVEY 60 60 significantly since 2006, from 1.1 hours to 3.1 hours per month. Nonetheless, it remains small compared to 50 50 the average for upper middle income economies (6 hours), Africa (49 hours), and the global average (29 40 40 Percentage hours). Accordingly, losses due to power outages also Hours 30 30 increased (1.2% of total sales in 2013 vs. 0.2% in 2006). More firms appear to need generators in 20 20 Namibia, perhaps as a response to falling service, or as a result of development patterns. In 2013, 18% of 10 10 firms reported owning or sharing a generator compared to 13% in 2006. 0 0 Average total time of power outages Percent of firms owning or sharing a per month generator Namibia2014 Namibia2006 Africa Upper middle income Access to finance and electricity continue to be the biggest obstacles to private firms’ operations The Enterprise Survey asked business owners and top Access to finance managers to name the biggest obstacle that they face Access to land in their everyday operations. In 2013, access to finance Corruption was identified most frequently as the biggest obstacle Electricity Licensing and permits – by 48% of firms, compared to 12% in 2006. Crime, theft and disorder Interestingly, firms’ perception of access to finance as Customs & trade regulations an obstacle worsened between 2006 and 2013 despite Tax rates Informal competitors the indicated improvement in the use of financial Tax administration services by firms, perhaps due to a growing demand Poorly educated workers from the private sector. The second most frequently Labor regulations cited obstacle in 2013 was access to land (21% of Courts Namibia2014 Transport Namibia2006 firms), followed by corruption (10%). Political instability 0% 10% 20% 30% 40% 50% 60% Percentage of firms The Enterprise Analysis Unit is a joint World Bank and IFC team of economists, survey experts specialized in private sector development. Surveys implemented by the team reveal what businesses and firms experience across the world by interviewing representative samples of the formal, non-agricultural, non-extractive, private sector with 5 employees or more. The resulting globally comparable firm-level data is used to construct business environment indicators and measure firm performance. The findings and recommendations help policy makers identify, prioritize, and implement policy reforms that support efficient private economic activity. For more information on the survey visit http://www.enterprisesurveys.org Generated using Enterprise Survey data as of June 26, 2015