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Role of law in terms of economics regarding investments

2021-03-26  Staff Reporter

Role of law in terms of economics regarding investments
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Hileni Shilamba

The law should be understood as a shaping tool used in carving the aspirations of a country. Economic law reform should therefore be on the agenda to ensure that future generations have effective laws that are applicable and relevant. Such laws must not only be relevant in furthering economic development, but must also be implemented effectively by the relevant institutions, instead of simply idealising the notion of economic emancipation and growth. 

Over the years it has become increasingly evident that legislative frameworks need to be industry, investment and institution-friendly to gradually harmonise the economic sphere. In doing so, laws must be implemented in a manner in which there is a certain degree of certainty of knowledge, security of interests and confidence for the system’s future participants. Practical laws can make substantial contributions to development by exploring and articulating unique definitions of law, and also the state of affairs that emerge from the relationships between law-making institutions and politics in society.

Faulty legal rules and practices could potentially reduce incentives for investments and increase the cost of innovation. This in particular is corroborated by Namibia’s economic history regarding the overall decline in investments, due to the result of unfavourable laws  having been implemented in the past. 

Suggestively, consulting various jurisdictions may result in providing feasible, influential guidance within the Namibian law-making context. Furthermore, the adoption of blue and green economies is an exceptional notion for the advancements the world has made, and of which Namibia should follow suit in order to diversify society by interlinking various sectors. It is an exciting concept, especially during these trying times worldwide, and consequently highlights the importance of formulating and implementing legislation that caters towards surviving abrupt changes in any economy. 

It is further vital for laws to be backed by proper implementation strategies and execution, and consequently used as a tool to encourage the private sector to play a much more active role in the nation’s economic affairs. Other factors such as the will and attitude of a nation, education, a skilled population and many other contributory factors play an important role in ensuring the success of economic growth legislation in a country. The law is however the first pinnacle in setting the tone in any economy. 

The Namibian government should efficiently exercise control over investments and investors in accordance with the Namibian constitution, without prejudicing the Namibian people. Personal discretionary powers should be limited as deemed fit, and should be held accountable by a superior entity. This can be done by implementing transparent procedures in investment dealings to ensure that due process has been complied with to attain social justice. Investments should also be prioritised in the sectors in dire need, such as the agricultural and manufacturing industries instead of the already stable industries, which nonetheless should not be neglected. 

It is however important to note that investments do not play an isolated role in ensuring economic development and growth – multiple stakeholders should be involved such as sector cooperation, an educated nation, technological advancements, crisis aid mechanisms, capital of all sorts and harmonised politics. 

Namibia’s economic plans should be advanced by the National Planning Commission having the mandate to give the Namibian economy a facelift by spearheading the Namibian economic development agenda through law and execution. 

 A further mandate is to encourage productive investment and to discourage excessive, non-generating consumption. It is important to note that insofar as education, inclusivity and fair distribution of resources lags, investments will not make much of a difference in our society and citizens will not be well equipped with the know-how of aiding the fluctuating economic climate. With the established Harambee Prosperity Plan II and the Namibian Investment Promotion and Development Board (NIPDP), we expect nothing but a fruitful future. 

2021-03-26  Staff Reporter

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