2008-06-04Staff Report 2 "By Desie Heita Windhoek A Monday evening public lecture on financial system and economy has shown how Namibians are drowning in a cocktail of hunger for information and frustration over the current economic crisis. Although attendance was very poor, the odd audience of 15 that turned up put the speaker's head, Dr Gift Kavari, on the block demanding answers on many pressing issues such as interest rates, bank charges, and the operational nature of Namibian banks. It did not help that Kavari is the Credit Origination Manager at Standard Bank Namibia - the audience thought he is holding out on some of the answers. ""Debate is good. Questions and the level of participation from the audience surprised me. It shows that there is need for such public lectures where the public can engage in debate to discuss some of these issues,"" said Kavari. Kavari presented a synopsis - the public lecture was postponed due to poor attendance - on the 'Importance of the Financial System to the Namibian Economy'. Although the presentation was more of an academic nature, complete with literature review, as opposed to an analytical piece, it evoked public debate on the country's financial system set up. The lecture focussed on sound financial system, fiscal policy, monetary policy and long-term funding versus long-term loans. Kavari did observe, for instance, that there is little corporate participation in the local financial market with very few corporate bonds, and non-existence of municipality bonds. He also said there is a need for measures and regulations that create incentives for financial houses to take an interest in investing money in the country instead of always looking beyond the border first. On the contrary, though, the audience's interest was on issues such as the difference between Namibia Financial Institutions Supervisory Authority (Namfisa) and Namibia National Reinsurance Corporation (NamibRe). The former is the supervisory authority on financial institutions, while the latter is responsible for the creation of reinsurance capacity for the insurance companies. While Kavari praised the establishment of commercial banks and their pro-active approach towards setting up a sound financial system, the audience questioned the lukewarm approach of commercial banks towards micro financing the poor. A member of the audience came short of accusing the four commercial banks of operating like a cartel, but did mention that banks are monopolistic and collude on their charges and prices to consumers. ""Otherwise, why are there no other banks, besides the South African banks? Why is there no merchant bank in Namibia, is it not because the current banks make it impossible for other banks to come in the market, giving the reasons that Namibia is a small market while they make so much money from the small market,"" the audience asked. It is a question that, perhaps, had Kavari thinking he should not have bothered to show some of the graphs to the audience, such as the profit the banks have made in the last seven years, for instance. The audience also wanted to know if the US mortgage crisis would affect the Namibian economy. " 2008-06-04Staff Report 2
