Nam’s Economic Hope Lies in Investments – !gawaxab

BANK of Namibia governor Johannes !Gawaxab has said the most critical element to help grow the Namibian economy is investments.

!Gawaxab said this at a recently held central bank round-table economic discussion with the chairpersons of boards of directors and executives of private sector companies that mobilise investments and savings in the country.

Renowned economist Carlos Lopes at the 2019 economic summit said Namibia is one of a few countries with underutilised savings, and it appears !Gawaxab heeded this observation.

At the round-table discussion he said both domestic and foreign direct investments are needed to boost the economy.

He further said the current weak growth being witnessed in the domestic economy reflects the strain in four critical elements of the national income identity – with consumption spending by households constrained as a result of souring unemployment due to the economic fallout from Covid-19 as well as government spending which is also under pressure due to limited fiscal space.

Net exports are also severely affected by global demand and low commodity prices, !Gawaxab said and, the most element to help grow the Namibian economy is investments.

“Concerted efforts, both from the public and private sector, are needed to unlock the country’s investment potential,” he said.

According to the bank’s update, the round table also weighed in on the means of enhancing domestic investments in the country and how best to adapt the policy environment so that businesses are able to invest more or explore new opportunities within the economy.

It was also agreed that Namibia should pursue an aggressive economic turnaround strategy to enhance growth and income outcomes.

Emma Haiyambo, the communications director at the Bank of Namibia, said these discussions would inform continuous efforts by the bank to find practical and home-grown solutions to the structural challenges besetting the economy.

The central bank predicts that the Namibian economy is expected to record a gradual economic recovery, posting economic growth of 2,6% this year.

This is in the hope that the global economy would reopen fully after Covid-19 lockdowns and restrictions.

This is set to increase the demand for Namibia’s exports (especially minerals), and bodes well for the recovery of the domestic economy.

Namibian savings institutions have billions in uninvested funds, and the lack of bankable projects has over the last few years held back development.

Analysts have complained that the non-banking financial sector regulator, the Namibia Financial Institutions Supervisory Authority, has been dwarfing investment opportunities with its regulations on where to invest and how much.