Foreign investment can come but it can also go. The sharp end of losing a foreign investor became painfully clear to us when Ramatex abruptly shut down its operations in Namibia last week. That put three thousand people on the street, not counting the families depending on them. Ramatex had it all too easy in Namibia.

They did not pay for the factory premises, they were heavily subsidised on water and electricity and the N$100 million to train the workers, also came from the government. During the week, I heard the observation that the textile industry works in cycles. Now it is moving back to Asia where labour is much cheaper and labour protection does not exist. For us it is a major blow. Not only are 3000 people without jobs, our entire foreign investor policy is under threat.
I think it is time that we have a rethink regarding our foreign investment incentives. Ramatex illustrated one side of the coin: No matter how convenient and accommodating the government is, when conditions do not fit their business plan, they up and out. We now need to look at the other side. Which are the industries we can offer more than just labour and accommodation?
Perhaps the most obvious shortcoming in our existing policies is that we want large manufacturers regardless of what they manufacture. Were we a major cotton growing country or producer of artificial fibre based on petroleum, it would make sense to woo a textile company. I am not propagating that we shun manufacturers, I am advocating a bit of common sense. It would be better if the secondary industries we target are based on, or dependent on the primary commodities we produce. And primary commodities we produce in abundance.
I know all the arguments against local beneficiation: economies of scale, technological requirements, lack of synergy, low productivity, and distances to markets, etc. etc. What I do not know are the positives, but I can think of many.
The first and most obvious is that many of the resources are right here under our feet so it makes all the sense in the world that some of the beneficiation can also be done right here. In this regard, Skorpion is a leading example. Instead of exporting huge volumes of ore, at least they extract metal to a raw level and export ingots. I doubt it our production of Zinc is sufficient to merit a large foundry or extrusion plant but that should not put off any investor if it feels it can run a successful operation on a smaller scale and still compete with international prices.