How to invest in Namibian farmland as a foreigner

Namibia is a country with a thriving agricultural sector. Many locals rely on this important fraction of the economy for their livelihoods. The agricultural contribution to Namibia's overall GDP (Gross Domestic Product) over the last 5 years has accounted for just over four per cent.

Agricultural farming is not limited to crop farming and forestry. The Namibian livestock market is a lucrative one. Namibia has become known for its quality beef and lamb and exports to countries in Europe and the United States, China and South Africa. Livestock farming is essential to Namibia's growth on a global level. With a scale this size, it's no wonder the agricultural sector will see a surge of potential new investors. But how do you enter this market at the source and begin owning farmland in Namibia? RealNet Rainmaker Namibia puts the spotlight on what it takes to be a foreign investor in the agricultural space.

The ground rules

Agricultural land is commonly divided into communal and commercial farmlands. Consent is granted by the Minister of Lands and Resettlement. The title deed can either be registered in the investor's personal name or under the legal entity of a corporation or company.

Foreigners are not allowed to be the majority shareholder of any land used for agricultural purposes. At least 51% has to be registered to a Namibia citizen or legal entity. This ensures that a controlling percentage of a sector that greatly influences the economy reflects Namibian focus and power.

How do I sell my farm?

Before you are able to sell or buy agricultural land in Namibia it is important to determine if a waiver has been granted. If you're a Namibian citizen who wants to sell your farm to a prospective owner, you will still need to provide proof that you will retain a controlling percentage of the land. As a local, you are still expected to abide by the laws of the land or you and your foreign investor partner will both be subject to forfeiture. Around 4000 commercial farms populate Namibia's agricultural sector and competition to supply is steadily rising as demand increases worldwide.

Buying agricultural land for commercial purposes

Livestock is the most popular choice for farming. Cattle and sheep farms do especially well in overseas markets and have become an ongoing source of trade in the neighbouring country of South Africa. High-quality Namibian meat is sought-after in the restaurant business and many stockists prioritise Namibian suppliers over local. Crop farming for commercial sale can also include fruit and vegetables such as grapes, tomatoes and melons. Wheat farming consists of staples like maize, beans, sorghum and pearl millet.

The investment opportunities are varied for a foreign agricultural landowner. Joining the Namibian farming environment requires in-depth research and acquiescence to national laws. However, you can expect to enjoy the revenues once you become a well-recognised vendor in the business.

A background in agriculture

Prior knowledge in the field of farming and agriculture is recommended. Namibia has many educational levels of agricultural training. You can enrol to study agricultural courses at a number of institutions across the country including the University of Namibia, Namibia University of Science and Technology and Ogongo Agricultural College to name a few. It is a good idea to have the basic outline of the communal farming sector and the formal food retail sector. Communal farming occupies 41% of agricultural land and accommodates approximately 67% of the population. Subsistence agriculture makes up 90% of their living. Wholesalers, supermarkets and local shops make up the rest of the formal food retail sector, with high-end restaurants joining this list.

Sealing the deal

The location of your potential new farmland is important. Joining forces and consulting with property experts who specialise in identifying the perfect agricultural areas to invest in is vital. Geographical factors such as soil density, rainfall and general weather conditions will affect your crops and livestock.

You have to ensure the farm you choose is well suited to the agricultural endeavour you have in mind. It's wise to assess what the farm currently produces and only introduce a new element if it's proven to be successful. RealNet Rainmaker Namibia has a team of professionals on board to help you with the legal terms and conditions of becoming an agricultural landowner. Contact us today.