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Osino Resources has acquired the remaining minority interests in three of its subsidiary companies holding the Namibian mineral licenses underlying the Twin Hills Gold Project and part of the Karibib exploration area, respectively.

 The Canada-based firm this week signed an agreement with Somerschield Investments Close Corporation to acquire 3% of the shares in the capital of Osino Gold Exploration and Mining (Proprietary) Limited (Osino GEM) for an aggregate value of N$24 million payable through the issuance of 1,700,000 common shares of the Company. 

Osino GEM is a 97% owned subsidiary of Osino and holds 3 Namibian exclusive prospecting licenses covering a total of 24,171 hectares, including an EPL which holds most of the Bulge and Twin Hills Central mineralization, forming part of Osino’s overall Twin Hills gold mineral resource. 

“The acquisition of these minority interests, by way of stock priced at a premium to market, eliminates the inconsistent subsidiary ownership structure and results in Osino’s effective ownership in the Twin Hills Gold Project increasing to 100%. We are very pleased to have been able to agree on this transaction with the minority owners, who have been long-standing supporters and shareholders of Osino,” the company’s President & CEO Heye Daun said. 

“The selling parties have hereby agreed to restructure their ownership from the Namibian minority level to the Canadian public company level, aligning all shareholders’ interests. They have also agreed to remain locked-in for up to 2 years which is testament to their commitment to Osino,” he added.

 Also acquired was Ominda Mineral Resources Close Corporation’s 10% interest in Osino Namibia Minerals Exploration for an (ONME) aggregate value of N$11.2 million payable through the issuance of 1,000,000 common shares of the company. 

ONME is a 90% owned subsidiary of Osino and holds 8 EPL’s covering a total of 86,409 hectares, including an EPL which hosts the gold mineralization at the Clouds deposit, forming part of Osino’s overall Twin Hills gold mineral resource. 

In addition, Osino acquired Richroad Investments Close Corporation and South Wing Investments Close Corporation’s 20% shareholding N$1.8 million, payable through the issuance of 37,617 shares and a cash payment of N$1,24 million to Richroad and Southwing.

 

Richwing is 80% owned by Osino and holds an EPL which hosts gold mineralization and industrial minerals south of the Twin Hills project area.

 

Osino is a Canadian gold exploration and development company focused on the development of the Twin Hills Gold Project in central Namibia and recently completed the acquisition of Ondundu gold exploration property in Namibia from B2Gold for a total consideration of N$257.3 million settled through shares in lieu of cash.

 

 

The City of Windhoek has extended the term of O'Brien Hekandjo as Acting Chief Executive Officer by three months.

The Namibia Airports Company (NAC) has called for the establishment of a new sustainable national airline.

Kazera Global, which owns Tantalite Valley Mine in Namibia, says it is ready to increase production of tantalum and lithium after it received N$8.4 million from Chinese company Hebei Xinjian Construction.

Pan-African Finance Group Letshego has launched a low-cost housing scheme for Namibia and Botswana with plans to roll it out to other African countries.

The Bank of Namibia has appointed Lloyd Londt  to the position of Finance and Administration Director and member of the central bank's senior management team.

Development Bank of Namibia (DBN) Chief Executive Officer, Martin Inkumbi is set to step down from his role in August 2023, at the end of his current second five-year tenure.

The NAMDIA Foundation has launched a N$2.8 million annual Bursary Scheme in honour of Zacharias Lewala, who discovered the first diamond in Namibia, in 1908 in Kolmanskuppe.

Proposed changes to South Africa’s finance regulations to stop money laundering and terrorist financing could cause major headaches for businesses in the country – and lead to higher prices for consumers.

Presenting to the standing committee on finance on Tuesday (16 August), the Financial Intelligence Centre (FIC) proposed that the Financial Intelligence Centre Act (FICA) be amended, broadening the scope of ‘accountable institutions’ under its purview.

This change would force both small and large companies to comply with FICA regulations, adding an administrative burden and costs to business operations.

By doing this, the FIC aims to identify the proceeds of crime, combat money laundering and terror financing as well as supervise and enforce compliance with FICA.

The proposed amendments argue for the following types of entities to be included as ‘accountable institutions’:

  • Certain legal practitioners;
  • Credit providers;
  • Boards of executors or a trust company;
  • Estate agents;
  • Long-term life insurance businesses
  • Dealers in motor vehicles;
  • Dealer in goods over R100,000;
  • Dealers in crypto assets;
  • Dealers in Krugerrands, and;
  • Gambling institutions.

Bad for business

Critics of the proposed changes argued that the amendments to FICA are too broad in their definitions and would include activities that pose no risk of money laundering or terrorist funding.

The inclusion of an entity into the scope of the Act entails that extra compliance measures be taken to ensure that financial crime does not occur – this, however, comes at the cost of a company.

During the committee meeting, industry figureheads representing the insurance industry, the retail sector, the mining sector as well as financial service companies raised concerns over the scope of the amendments.

Keigan Hart, a spokesperson for Outsurance, said that the draft amendments could affect how business in the insurance sector is conducted with the extra costs of compliance ultimately falling on the consumer.

Hart said that the services Outsurance offers are low-risk products that should not be subjected to the same compliance provisions as seen with banking products. He added that the increased compliance costs, especially where the services of third-party vendors are concerned, are not proportionate to the risk.

“Increased compliance costs result in the increase in product costs which is ultimately passed onto the consumer,” said Hart.

The South African Institute of Chartered Accountants (SAICA) said that the accounting industry could face some challenges if the draft amendments are implemented. SAICA said that the amendments lack clarity and do not factor into account the cost of compliance.

SAICA recommended that smaller businesses (SMMEs) be subject to a lesser requirement and that other mechanisms such as transaction value could be used to manage risk when assessing accountants.

The Minerals Council of South Africa also added that the proposed amendments be redefined as they are too wide and must include only cash transactions over R100,000 not ‘payments in any form’.

The proposed amendments were said to be a blunt instrument in a broad kneejerk reaction to the possible ‘greylisting’ and sufficient thought has not been given to the impact such regulations could have on business in the country.

A recent report from the Financial Action Task Force (FATF), an international watchdog, identified significant weaknesses in parts of South Africa’s financial regulation. Such weaknesses have resulted in high cases of money laundering and terrorism funding in the country.

If no significant changes are made to legislation, then the country could be greylisted.

According to Rebecca Thomson, a senior associate at Allen & Overy, this would mean the country would be deemed as high-risk jurisdiction to transact with, and anyone wanting to do business with South Africa will need to take extra steps.

Government has until October to demonstrate that it has a credible plan to address its deficiencies – failing to do so would result in the country being greylisted in February of next year.

Pieter Smit, an executive manager at the FIC, said that the group could not exclude businesses from the scope of the act even if there is a low risk of financial crime. He added that if there is any risk, then the implementation of the act and its provisions will be risk-sensitive.

The Bank of Namibia (BoN) is expected to increase interest rates by another 100 basis points before the end of the year, analysts have said.

This is after the apex bank’s Monetary Policy Committee (MPC) resolved to increase the Repo rate by 75 basis points to 5.50% from 4.75 at its bi-monthly meeting on the 15th and 16th of August 2022.

"The decision was taken with due consideration of the persistent inflationary pressures and is deemed appropriate to safeguard the one-to-one link between the Namibia Dollar and the South African Rand, while meeting the country’s international financial obligations. Moreover, the adopted monetary policy stance is necessary to narrow the current negative real policy interest rate," BoN Deputy Governor Ebson Uanguta said on Wednesday.

He said policy stance was consistent with that taken by central banks around the globe, and in the region, with policymakers acting with resolve to slow and eventually reverse the current acceleration in inflation.

"The MPC will continue to monitor these developments and their potential effects on the domestic economy and will act appropriately and in line with its mandate to ensure price stability in the interest of sustainable economic growth and the development of the country," said Uanguta.

Simonis Storm Economist Theo Klein said the hike was in line with expectations and follows a similar move by the South African Reserve Bank which also hiked its Repo rate by 75 basis points in July 2022.

"The forward rate agreement curve in South Africa which summarizes market participants expectations of short-term interest rates, so we expect another 100 basis points hike before the end of the year if it materializes in South Africa,” he said.

With Namibia's current rate at 5.50 %, he said “this depicts that interest rates are getting closer to the pre-pandemic levels when the repo rate was at 6.2 % in February 2020.”

Klein said once a 100-basis point hike is announced, the rate will surpass the pre-pandemic levels.

"Interest are still being hiked in South Africa and Namibia although inflation is driven by supply side factors which interest rates have no control over and this is primarily for two main reasons, which is central banks trying to limit the currency weakness and itself is inflation thus through this insect way they are attempting to contain inflation, and secondly they want to keep inflation expectations anchored around their target.

“In South Africa, this is between 3% and 6%, so to keep inflation expectations anchored the central bank will hike the interest rates to try and signal to the market that the high levels of inflation are unlikely to persist in the medium to long term.”

The Economist added that inflation expectations need to be managed and anchored around the central bank’s target.

“This is because when expectations move higher and employees demand higher salaries this will lead to higher prices and inflation rates, as business need to pay these higher salaries, thus through this channel central banks use hiking rates to signal to the market that long term inflation is likely to gravitate towards its target range so that inflation expectations are managed and anchored around the central banks targets range," said Klein

Through these indirect effects he said the central bank in SA is trying to contain inflation and with the NAD and Rand peg, BoN has to follow suit.

Danie van Wyk, the Head of Research at IJG Securities concurred another rate hike was expected from BoN.

“The exact number- and size of any further rate hikes will depend on the inflation data released over the next couple of months, and particularly the magnitude of the second-round effects from rising fuel prices. We currently expect a 50 bp rate hike at the SARB’s September MPC meeting followed by a 25 bp hike at the November meeting, although there is always the possibility that they could be combined into another 75 bp rate hike in September instead,” he said.

Van Wyk added that while inflation continues to be driven more by supply-side factors than increased consumer spending, the SARB is front-loading rate increases, opting to stay ahead of central banks in developed nations, and reinforcing its commitment to anchoring inflation expectations.

“By not following developed market central banks in raising rates, South Africa is likely to see an outflow of capital which will weaken the rand, which is in turn inflationary and will just exacerbate the increase in inflation. The BoN’s mandate is to protect the currency peg with the South African rand, thereby anchoring domestic inflation expectations,” he said.

Rodney Hoaeb, an Economic Researcher with Harvest Investment, said the increase in the repo rate to 5.5% in the current economic times presents a scenario where governments are doing their utmost best to avoid the fears of recession asserted by high inflation rate and poor production levels.

"The cost of production is very high; interest rates are high, and this discourages people from spending on too much disposable goods considering the high level of food inflation.  The counter-reactionary move gives banks the comfort to retain expected returns on economic recovery," he explained.

Hoaeb said the external impact was also caused by China and US tensions where the US is fearing recession, EU member states are avoiding recession because of drought and reduced gas supply from Russia.

Reportedly China has reduced their commitment to US bonds as a retaliation against its support for Taiwan.

Thus, Hoaeb noted that one of the core things to tackle in Namibia will be to find ways to reduce government expenditure on imports.

"Government should find strategies to spend locally and ensure the money remains in the economy and stimulate growth. Secondly, the Government should reduce debt both international and domestic to stabilize the fiscal position and for confidence," he said.

The researcher further urged the Government Institutions Pension Fund to expedite the funding for infrastructure projects and various sectors in order to retain jobs and stimulate more growth.

"The GIPF has been withdrawn because of its selection process for unlisted investment; this was an economic setback in various sectors," Hoaeb said.

The next meeting of the central bank’s MPC will be held on the 24th and 25th of October 2022.

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