The International Monetary Fund (IMF) has called on Namibia to adopt a clear and comprehensive framework to manage its emerging oil and gas sector, warning that without robust governance structures, the southern African nation could miss the opportunity to convert resource wealth into sustainable growth.
“Managing large oil revenues requires a rigorous monitoring framework that enables transparent revenue projection and tracking,” the IMF said in its 2025 Article IV Staff Report for Namibia, published in June. The Fund stressed that such a framework is critical for “assessing policy options based on accurate data about potential oil production, including the quantity, timeline, and duration.”
Namibia has seen a surge in interest in its offshore basins following multiple discoveries by international oil companies in recent years, raising hopes of a hydrocarbon boom like Guyana’s. However, the IMF cautioned against premature spending and stressed that, in the early stages, oil revenues should be used to reduce public debt.
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“In the initial phase of oil revenues, the priority should be on safeguarding fiscal sustainability by reducing gross debt and avoiding premature asset accumulation,” the report said.
The government is in the process of establishing the Welwitschia Fund (WF), its sovereign wealth vehicle, which the IMF says should be integrated into the broader budget framework. The draft Welwitschia Fund Act is expected to be submitted to Parliament this year.
“With dual objectives—saving for future generations and serving as a fiscal and official reserves buffer—the WF’s rules should allow for a gradual adjustment of fiscal objectives to target the non-resource fiscal deficit,” the Fund stated. It also stressed that “the budget process remains critical, and the WF is not a substitute for prudent fiscal management.”
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A technical committee comprising several ministries and agencies has been formed to review Namibia’s petroleum regime, with a focus on balancing investor attractiveness and a fair national share, the IMF said. The State also plans to expand a petroleum monitoring framework developed with earlier IMF technical assistance.
The IMF’s recommendations come amid heightened optimism in Namibia’s energy sector, though no company has yet made a final investment decision. The Fund warned that without “active policies” to manage the sector well, the country could succumb to the so-called “resource curse.”
