The Namibian Chamber of Environment (NCE) represents the environmental civil society sector. It has come to our attention that the Namibian Competition Commission (NaCC) is taking issue with the manner in which joint-venture (JV) tourism enterprises operate within communal conservancies. Our concern in this matter relates to the implications of this investigation on the wider tourism sector within communal conservancies and resulting negative consequences for rural livelihoods and wildlife conservation.
Based on the information we have received, it is clear that the NaCC does not understand the tourism industry or appreciate the severe consequences of its stance on this matter. Context on the rights of communities granted through communal conservancies and the nature of the tourism industry as a whole is therefore provided. We then detail our specific concerns on the matter involving the Doro !nawas, Uibasen Twyfelfontein and Sorris Sorris Conservancies and Ultimate Safaris tourism operator. This is contrasted with other examples of anti-competitiveness that are currently overlooked by the NaCC.
1) Community rights as they relate to JV tourism
The JV tourism model in Namibia is based on the Nature Conservation Amendment Act of 1996, which provided for the establishment of communal conservancies. The main driver of this amendment was to provide similar rights to previously disadvantaged rural communities that were already enjoyed by freehold farmers under the Nature Conservation Ordinance of 1975. The non-consumptive use of game animals (achieved through tourism) is included in the rights conferred to communal conservancies, to be exercised in the same way (mutatis mutandis) as they are on freehold land.
In practice, this means that the community may decide which areas of their land must be used exclusively for wildlife, and may enter into partnerships with tourism operators and hunting outfitters to generate value from that wildlife. The community therefore has the right to dedicate part or all of its wildlife zone for the exclusive use of one or more tourism operators. Freehold farmers enjoy a similar right, and frequently allow or initiate tourism developments on their land that have exclusive access to part or all of their farms.
The Ministry of Environment, Forestry and Tourism (MEFT) implements this Act by assisting communal conservancies to broker agreements with private sector tourism operators. While different models for tourism operations exist in Namibia, the JV model has been the most successful and is the option that MEFT recommends for conservancies to pursue. To this end, MEFT has developed template JV agreements to ensure that community rights are respected, while the investments made by tourism operators are secure.
By intervening in JV agreements that are not anti-competitive (see reasons below), the NaCC is seeking to deny rural communities their hard-fought rights to use wildlife for their benefit in the same way that freehold farmers do. The NaCC has not intervened with any agreements that freehold farmers have with tourism companies that use their land – nor should it. Yet the differential treatment of rural communities by the NaCC represents a step back into the apartheid era of depriving communal area residents of their rights.
2) Tourism investment conditions and requirements for exclusivity
Although tourism is a non-extractive, low-impact industry, it is based on the presence of natural resources such as black rhino and other wildlife. It can therefore be compared in some ways to the mining industry, which is based on the presence of mineral resources. In both industries, the ability of one company to exploit the resource (wildlife or mineral) is dependent on their exclusive access to this resource.
Mining Exclusive Prospecting Licenses (EPLs) can cover up to 1,000 km2 in Namibia, including on communal lands without the express permission of the communities that live there (unlike tourism, which requires such permission). This allows a mining company exclusive access to this area for the purposes of prospecting for minerals. Mining Licences frequently cover several thousand hectares and provide for the exclusive use of the area by the licence holder for 25 years or the life of the mine. Without such exclusive access to the area, mining investment would be rendered impossible. The NaCC has not objected to mining companies being granted EPLs or Mining Licences based on anti-competition issues, as these would make no sense in the context of the industry.
The wildlife-based tourism industry requires relatively large areas of intact habitat where wild animals can live and be seen by visiting tourists. If the area is destroyed (e.g. through mining) or overcrowded by many tourism operators, the tourism product is either eliminated or it declines in value. As a result, communal conservancies voluntarily set aside parts of their land for wildlife, knowing that this increases the value of the tourism product. They may then allocate parts or all of their wildlife zones for the use of one particular tourism company for a period of up to 25 years. The NaCC’s objections to these arrangements therefore make no sense in the context of this industry.
Unlike mining, tourism does not prevent people from traversing their exclusive zone. Local people may still traverse the area for their own purposes, or guide tourists into the area to benefit from their wildlife. The only thing that is prevented through the exclusivity clauses in the JV Tourism arrangements is for other lodges to be built in close proximity.
3) The example of the Doro !nawas, Ûibasen Twyfelfontein and Sorris Sorris Conservancies’ agreements with Ultimate Safaris
This particular complaint to the NaCC arises not from another tourism operator that feels excluded from the market, but a mining contractor that is currently embroiled in a court case with these conservancies and their partner. This fact alone should alert the NaCC that the complaint has little to do with genuine concerns relating to competition within the tourism industry.
The areas covered by the exclusive zone in the various Ultimate Safaris JV contracts represent small areas relative to the overall size of the relevant conservancies. These agreements do not prevent these conservancies from using other parts of their lands for tourism or other land uses. Each lodge built by Ultimate Safaris has the exclusive rights over 1.9-2.2% of the conservancy land where it is located.
This land can still be traversed by other entities or individuals (e.g. local guides or guides from other lodges). Other lodges have been and may still be built in the wider area beyond these exclusive zones. There are approximately 25 tourism establishments and operators within these three conservancies. Tourism within these conservancies therefore remains highly competitive, as guests wanting to stay in the area covered by these conservancies have multiple options besides the lodges operated by Ultimate Safaris. This case – and other JV agreements like it – therefore does not contravene Sections 23 and 26 of the Namibia Competition Act.
4) What is at stake if this investigation sets a precedent for other JV agreements
As explained above, the JV agreements between conservancies and their private sector partners are mediated by MEFT, which provides templates for these agreements. These all make provisions for exclusive zones directly around lodges because this makes sense within the context of the tourism industry and provides greater security for private sector investment. Private sector JV partners already struggle to access loans to finance investments in conservancies due to lack of land tenure security – if JV agreements are no longer secure, most investors will withdraw from conservancies altogether.
The whole JV tourism model across all communal conservancies is therefore under threat by the NaCC intervening in a sector that it clearly does not understand. The scale of this threat is important to note: 74 JV tourism agreements provided over 1,000 jobs and contributed over N$ 111 million to conservancies in Namibia in 2023, representing 60% of their total income (MEFT and NACSO, 2024). Without this income, many conservancies would cease to function, while their members would lose jobs and other opportunities for enterprise (e.g. craft sales to tourists).
Within the national context of a struggling economy and high levels of unemployment, the Namibian government cannot afford to weaken tourism, which contributes 6.9% of the GDP. Attacking part of the tourism sector that most directly contributes to the livelihoods of some of the poorest Namibians living in remote rural areas is even less advisable.
While the NaCC could have continued its talks with MEFT to gain a better understanding of tourism in the context of communal conservancies, it instead opted to publicly attack one tourism company for adhering to MEFT’s guiding principles for JV tourism. This course of action immediately reduces investor confidence in conservancy-based tourism, impacting economic growth, job creation and the ability of conservancies to maintain their commitment to nature conservation. This public spat between one government department and another further weakens Namibia’s overall image as an investor-friendly country at a time when we can least afford it.
5) Examples of real anti-competitiveness within the tourism industry
The NaCC acting on a complaint arising from the mining industry about competition within the tourism industry is especially concerning given other examples of anti-competitive behaviour that the NaCC overlooks. If the NaCC takes issue with exclusive zones around lodges, it should take the same issue with mining EPLs and licences that have similar clauses. If mining is exempted due to the nature of the industry, then JV tourism should be exempted on the same basis.
Within the tourism industry, the NaCC ought to consider the monopoly that Namibia Wildlife Resorts (NWR) has within the national parks. This prevents competing tourism companies from building lodges on millions of hectares of land. This lack of competition allows NWR to provide notoriously poor services to tourists without fear of losing its market share. This impacts Namibia’s image as a tourism destination, with knock-on effects of dampened economic growth in this sector. There is a much stronger case to be made that NWR’s monopoly contravenes Sections 23 and 26 of the Competition Act than the JV lodges that cover a few thousand hectares each.
A recent exclusive tourism access agreement in Sossusvlei provides another example that is overlooked by the NaCC. In this case, local guides are prevented from accessing this major tourism attraction with their guests. Instead, they have to pay for a short shuttle service provided by one transport company from the parking area to the attraction. While the tender for this service was initially advertised as non-exclusive and therefore open to competition, MEFT changed the terms to exclusive after the tender was awarded.
This letter therefore constitutes a formal complaint to the NaCC on these anti-competitive behaviours. If these matters are not investigated, while the NaCC continues with its course of action against JV tourism in conservancies, it will expose prejudice against three communal conservancies and their private sector partner.
Concluding remarks
The NaCC is allowing itself to be used as an attack dog in a legal matter that has nothing to do with competition within the tourism sector. By intervening in such a matter, the NaCC is displaying its ignorance of the JV tourism model in particular and its disregard for potential negative impacts on the tourism industry, on private sector investment into Namibia, and on the livelihoods of rural communities who have invested decades managing and building their wildlife resources and partnerships to obtain benefits from tourism. Rather than “promoting and safeguarding competition in Namibia” as per its mandate, it is stifling economic growth and job creation in remote rural areas that are gripped by poverty.
We therefore call on the NaCC to reverse its decision to investigate the matter between Timoteus Mashuna and Ultimate Safaris and its partner conservancies. It should then engage with MEFT to further understand JV tourism arrangements to ensure that such specious complaints are not entertained in future. We further call on the NaCC to investigate the anti-competitive nature of the NWR’s monopoly in national parks and the Sossusvlei shuttle service.
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