Trade ministry deflates threat on minerals export bans

The Ministry of Industrialisation and Trade has deflated an apparent threat that emanated from the the recent mining indaba held in London that Namibia could fall foul of World Trade Organisation (WTO) rules over its ban of exports of unprocessed lithium.

Lawyer Peter Leon told the mining conference on 26 June the ban was a new form of resource nationalism, akin to “playing with fire”.

He was commenting on reports that Namibia and Zimbabwe had banned exports of unprocessed lithium – a sought-after mineral in the renewable energy industry – to promote value addition and job creation in the two countries.

Namibia also banned the export of other unprocessed rare earth minerals.

“Zimbabwe and Namibia are playing with fire, as this is against the fundamental principles of international trade law,” said Leon.

However, ministry spokesperson Elijah Mukubonda said in a statement the WTO does not explicitly regulate natural resources, because the organisation primarily focuses on trade regulations and not on the management and conservation of natural resources.

“The WTO’s main objective is to promote free and fair trade among member countries, ensuring that goods and services flow freely across borders without unfair trade practices,” said Mukubonda.

He said according to the Namibian Constitution, all natural resources, including minerals and petroleum that are found below and above the surface of the land, within the continental shelf, territorial waters, and exclusive economic zone, belong to the state.

“This means the government of Namibia has authority and control over the exploration, extraction, management and utilisation of these resources for the benefit of the country and its citizens.

“The Constitution ensures that these resources are managed and used in a sustainable manner, with the aim of promoting economic growth, environmental protection and the social welfare of the Namibian people,” said Mukubonda.

Explaining why the WTO does not directly regulate a country’s natural resources, Mukubonda said the main issue was sovereignty.

He said each member country has the right to manage its own natural resources as it sees fit, as long as it does not violate international trade rules.

“Natural resources are considered a part of a country’s sovereignty, and the WTO respects this principle. It does not interfere with a country’s decisions on how to extract, manage, or trade its natural resources,” he said.

Then there is the issue of environmental concerns under which a country’s natural resources often have significant environmental implications, according to Mukubonda.

He said their extraction, processing, and use can have adverse effects on ecosystems and contribute to climate change.

The regulation of natural resources is often more complex and requires specialised knowledge and expertise in environmental management.

“These issues fall under the jurisdiction of other international agreements and organisations like the United Nations Environment Programme and the Intergovernmental Panel on Climate Change, rather than the WTO,” the spokesperson said.

Mukubonda said the WTO acknowledges the principle of special and differential treatment for developing countries, as many developing countries heavily rely on the export of natural resources for their economic development.

“Regulating natural resources directly through WTO could potentially disadvantage these countries and hinder their economic growth,” he said.

Mukubonda, however, said despite natural resources not being directly regulated by the WTO, trade-related aspects of natural resource management can still be subject to the WTO rules, such as trade restrictions, export taxes, or import quotas.

“Additionally, countries can negotiate agreements on specific natural resources outside the scope of the WTO, such as bilateral or regional agreements on fisheries or timber trade,” he said.

Zimbabwe, with large reserves of hard rock lithium, imposed a ban on the export of unprocessed lithium in December to stop illegal exports of minerals by artisanal miners.

Namibia followed suit with a similar ban in June.

Namibia has significant resources of rare earth minerals such as dysprosium and terbium, which are vital for the manufacture of permanent magnets for electric cars and wind turbines.

– email: matthew@namibian.com.na