• November 19th, 2018
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Heed private sector advice

THERE is no question Namibia needs to urgently respond to overwhelming challenges of poverty, unemployment, low-income levels, and an economy that is not producing at the desired pace. It is for this reason the 2015/16 National Budget is what it is, at N$67.1 billion. On the one hand, it would be delusionary, and a sign of severe delirium, if one does not listen to the concerns from the private sector, especially with regard to whether or not the spending would eventually generate sufficient economic growth for the desired sustainability. On the other hand, it would equal nothing else but a symptom of ‘grandiose delusions’ should one fail to note that indeed here is a government besieged by social and structural challenges. And that the budget is a weapon available to be deployed to tackle the structural challenges that affect the development potential of the economy, unlocking opportunities for jobs and wealth creation, and the immediate improvement of the welfare of Namibians in an inclusive and sustainable manner. Economists have for centuries debated, with much agreeing and disagreeing in between debates, that balancing a budget is a secret not yet discovered since mankind invented economic systems. Just less than a week ago, the Namibia Statistics Agency (NSA) confirmed, in their Labour Survey Report for 2014, that Namibia needs to create employment opportunities for 278 245 people, who are currently without jobs, a sizeable number of who have academic qualifications. The number of unemployed Namibians is really too high for a country with a population of 2 247 021 people. That number would increase this year, when the final tally is done on those who left schools and universities. Thus this budget aims at creating job opportunities, through the many developmental projects – including construction of railways at a cost of N$4.74 billion, roads at a cost of N$4.97 billion, and houses at a cost of N$3.25 billion. At the same time, having better roads, railways, ports, and other infrastructure ensures that Namibia is able to attract investors who could bring manufacturing and processing of fish, meat, transport services, among others, thus enabling Namibia to sell its products outside and make money for herself. It was only a few days ago, that the very NSA Labour Survey Report told of so many employed Namibians earning salaries so meagre they cannot adequately feed themselves and their families. NSA reported on the thousands of households wherein families live on less than N$1 000 a month. The question is how do you turn a blind eye on a household of four surviving on infrequent income that is less than N$1 000 when it does arrive? It is heartening to have a budget that boldly cares for the immediate and overwhelming social needs, not only by increasing the old-age pensions, but also by rolling out the pension to all corners of the country on time. The reality is that the number of pensioners is increasing at a rapid speed and if we do not invest in the rolling out of logistics, many old people would be left out. Orphans and vulnerable children are also being considered, and health and education are other areas where huge amounts of money were spent. It is beyond debate that for this budget, Namibia would have to borrow to make up for the projected at N$8.64 billion deficit, in order to fulfil financial obligations it committed itself to in the budget. That the budget carries a huge debt is neither here nor there. Suffice to say, Namibia is one of the very few countries that spend billions of dollars each year, without borrowing from the foreign institutions that have caused so many African economies to collapse. This, in itself, is a commendable feat. Namibia makes do with what it has and borrows very little at reasonable interest rates from the capital market, going as far as utilising local capital markets as much as it could, before venturing into regional and global capital markets. Economic books, and research papers, are filled with pages on case studies on effects and consequences of too much borrowings, and inherent dangers, fiscal and monetary, from so-called Bretton Wood Institutions. The collapse of economies of Southern African countries is all too known to many. Namibia is far from being engraved into those textbook case studies.
New Era Reporter
2015-04-02 09:02:08 3 years ago

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