By Dhiladhila Magazine · Issue 02

The mines paid the state more than ever in 2025, even as their real output fell. The gap is the story.

Namibia’s mines paid the state N$7.8 billion (about US$430 million) in taxes for 2025, a 39 per cent rise on the N$5.6 billion of the year before, and yet the sector’s real value added contracted by 9.4 per cent over the same period. The Chamber of Mines set out the paradox in its annual industry review, reporting record fiscal receipts from an industry that, measured in physical output, shrank.

The reconciliation is in prices and product mix, not tonnage. Elevated global gold prices and a 20.8 per cent rise in uranium production lifted mineral sales by a quarter to N$64.18 billion, while a 5.6 per cent fall in diamond output weighed on the physical base. Revenue climbed because of what the minerals fetched, not because more rock left the ground.

Record receipts from thinner output

The fiscal headline is unambiguous. Company taxes reached N$7.8 billion, royalties rose 9 per cent to N$2.458 billion, and export levies jumped 90 per cent to N$685 million. The Chamber attributed the surge largely to corporate income tax from gold operations, naming B2Gold’s Otjikoto mine and the Navachab gold mine as the principal contributors in a year of strong bullion prices.

Set that against a 9.4 per cent contraction in the sector’s real value added, with mining still worth about 14 per cent of gross domestic product, and the shape of the year becomes clear. The treasury’s best mining harvest in recent memory grew out of price and margin rather than a larger volume of ground moved.

The state’s best mining year rode on price, not on more ore mined.

A concentration risk dressed as a boom

The receipts also expose how narrow the base has become. Gold and uranium carried the fiscal result while diamonds slid, and the year brought retrenchments at the Sinomine Tsumeb smelter and at Debmarine Namibia. A revenue line that leans on two rising commodities is strong until one of them turns.

That is the analytical caution behind the celebration. Corporate income tax tied to the gold price is the most volatile line in the mix, and a softer bullion market would pull the N$7.8 billion back toward the prior year’s figure as quickly as the price lifted it.

Two commodities carried the record; a narrow base is a fragile one.

The ranking that undercuts the record

A record tax year sat awkwardly beside a falling investment score. Namibia’s position on the Fraser Institute’s investment attractiveness measure dropped from 66 to 56 points, and its global rank fell from 30th to 51st, a slide the Chamber raised as a direct concern for future output.

The distinction matters for anyone reading the fiscus. This year’s receipts came from mines commissioned years ago; the next decade’s receipts depend on exploration and construction decisions being taken now, in a jurisdiction whose perceived attractiveness is drifting the wrong way.

For a finance ministry, that timing gap is the real signal. A strong tax print can mask a weakening investment pipeline for several years before the shortfall appears in collections, which is precisely when it is hardest to reverse. The record and the ranking, read together, describe a sector earning well today while quietly making the case harder for tomorrow.

A record collection can hide a thinning pipeline for years before it bites.

What the fiscus should read into it

For budget planning, the lesson is not to treat a price-driven 39 per cent jump as a new baseline. Mineral revenue of this kind is a windfall to be banked cautiously, not a structural rise to be spent against. The prudent read is to smooth it across the cycle rather than anchor recurrent spending to it.

The harder question is whether the state can convert a good commodity year into the exploration and investment that would make the next one less dependent on price. That is a policy choice, not a market gift.

Price gave the treasury a windfall; policy decides whether it becomes a trend.

For a finance ministry, an investor or a sovereign analyst, the 2026 review poses a single decision: whether to read N$7.8 billion as a durable gain or a priced-in windfall. Bank it as recurrent revenue and a softer gold market becomes a budget hole; treat it as cyclical and the question shifts to what would make Namibian mining earn as well when prices are not doing the work.

Sources: The Namibian; Gold and uranium dominate mining sector (New Era); Chamber raises concern over decline in mining rankings (African Mining Market)