According to Bruce Hansen, managing director at Simonis Storm, after eleven quarters of negative GDP growth since 2016 in the second quarter of 2020, the Namibian economy contracted by 11.1% and is estimated to contract by 7.8% by the end of 2020.
The manufacturing sector was the third most severely affected sector, contracting by 30.8% in the second quarter of 2020 after a contraction of 8.5% in the first quarter. Diamond processing and beverage production dropped by more than half (53.9% and 51.5% respectively), and the fishing sector that showed some strong growth in 2019 (6.1%) contracted during the first half of 2020 by 3.9% and 10.5%. Hansen noted that with the lockdown came numerous company closures and over 5 000 job losses.
Meanwhile, the tourism sector was hit the hardest by lockdown, with ripple effects throughout the economy, affecting transport services, car rental companies, tour operators and related financial and telecommunication services.
Hansen noted that value addition of hotels and restaurants shrunk by almost two-thirds (64.2%) in the second quarter, while transport services dropped by 30.4%.
“The lockdown brought air transport and air transport services virtually to a standstill despite some evacuation flights. These sub-sectors decreased by 95% and 75.5% respectively.”
It is evident that many sectors of Namibia’s economy are now looking for ways to recover.
National protective public health measures were introduced this year, calling on Namibians to work together to find innovative ways to solve problems and build back better. Nedbank Namibia, which has total assets of N$20.04 billion, says it has been at the forefront of these efforts.
During the lockdown, to curb the spread of the pandemic, Nedbank Namibia dedicated substantial resources to look after staff and customers. A total of N$7.5 million was used for personal protective equipment (PPE) for staff, including for those working from home, as well as transport, cleaning and sanitising costs.
On a wider scale, to mitigate the effects of the pandemic and the subsequent lockdown, Nedbank provided generous financial contributions through its corporate social responsibility projects for the public health, youth, financial literacy, poverty alleviation, the staff volunteers programme, the Nedbank Go Green Fund and ultimately to continue hosting the country’s premier cycling race, the Nedbank Desert Dash donations.
Overall donations to alleviate the plight of Namibians, including to the National Disaster Fund, amounted to N$1.3 million. The bank also donated to Co-Feed Namibia, the Namibia Red Cross Society and an additional N$1 million in aid of conservancies during the tourism slump.
To help individuals and companies through the lockdown, Nedbank Namibia supported the economy through credit extensions to account holders to the tune of N$7.6 billion, 58% of which was for the benefit of individuals.
But beyond these contributions to the well-being of society, Nedbank’s dedicated vision and planning have helped to move society forward, in spite of the current difficulties. From 17 to 20 October, the bank’s executive committee visited the four northern regions of Namibia to assess the situation first-hand and investigate opportunities for growth and investment. During that visit, Martha Murorua, recently appointed managing director of the bank, said: “We also support economic development in the services, manufacturing and tourism sectors.”
Nedbank Namibia has implemented strategies – even before they were popular – that will stand the bank in good stead for a long time to come: focusing on enhancing its digital channels, delivering innovative products and services, and contributing to building a sustainable Namibia.
“Our adaptability and responsiveness enable us to deliver enhanced and innovative products, better client service and make a broader contribution to a sustainable Namibia,” said Murorua.
While the bank has 61 automatic teller machines (ATMs) across Namibia, new ways of accessing cash, paying for goods and services and transacting with the bank are growing exponentially.
The Cashout service continues to show strong growth, with Ohangwena, Khomas, Oshana, Oshikoto and Omusati accounting for the majority of transactions over its 202 Cashout points. Cashout is the service where Nedbank Namibia clients can withdraw cash from a supermarket cashier.
“Our Money App continues to show strong growth on an ongoing basis, while our recently-launched Send Money service is off to a strong start,” said Murorua. Send Money allows you to send funds from your Nedbank transactional account to anyone with a valid Namibian cell number by using cellphone banking, online banking or the Nedbank Money app.
The bank also has a history of empowering Namibians. In 2006 Nedbank embarked on a ‘ground-breaking’ Broad-Based Black Economic Empowerment (BBBEE) transaction in Namibia worth N$67m or the equivalent of 11,13% of NedNamibia Holdings (NNH) being transferred to Black Namibians, before legislation for this was in place and before the voluntary Namibian Financial Services Charter had been finalised.
Building back better
The bank’s strategy has been to deliberately build over the years assisting clients to get through the tough times. The construction industry is emerging from severe contractions since the boom turned into a crash in 2016.
Windhoek’s real estate landscape, too, with the help of Nedbank Namibia, is getting a much-needed shot in the arm through the Ongos Valley development. Nedbank is the lead arranger for phase one of the project, with 1 800 hectares of land having been acquired on the northwestern outskirts of Windhoek 14km from the central business district (CBD).
Nedbank Namibia has approved a N$220 million facility, joining other financing institutions like the Development Bank of Namibia, which provided infrastructure development facilities of N$450 million. The overall investment in phase one amounts to N$4,3 billion.
Ultimately, 16 000 jobs could be created, as 28 000 units will be built in seven phases over the next 25 years with schools, a shopping mall and associated businesses forming part of the overall vision for the project.
2020-11-10 07:17:07 | 17 days ago