INVESTMENT FOCUS
the National Planning Commission, NEPRU, UNAM, and the Bank of Namibia Research Department as well as ad hoc initiatives such as the President’s Economic Advisory Council have failed to provoke the hard thinking necessary for improvement. In policy terms then, Namibia’s first 25 years leave much to be desired. Indeed, Namibia appears to be living proof that an economy can grow and even prosper in the absence of economic input into policy-making and effective public institutions. Certainly, interest by foreign investors in Namibia through the years since the Global Economic Crisis has held up well, which has been the foundation upon which growth in the wider economy has taken place. Yet policymakers should not fool themselves. Namibia has continued to attract FDI because it has not yet permanently damaged international investor confidence (despite coming perilously close on several occasions). Yet this success should not be confused with more deep-seated structural transformation of the economy. Indeed, as Namibia completes a generation of sovereignty it looks set to become ever more dependent on its much maligned mining sector.
Linked to this is the almost universally poor performance of Namibia’s public enterprises, the most important of which have generally been poorly managed and suffered from endless political interference. Given that these are the institutions responsible for much of the nation’s critical infrastructure, this does not bode well for long-term growth. In agriculture, fishing, mining, water, electricity, tourism, transport, and banking, public enterprises have, with possible limited exceptions, at best contributed little to development and at worst held it back altogether. To these areas of concern can be added that of corruption. Thirteen years after its founding legislation has been passed, the AntiCorruption Commission has yet to successfully prosecute anyone in Government much higher than a school teacher. No one believes this is because Namibian public servants are somehow different to every other country. Everyone knows it is much easier to stop the slide into endemic corruption than to rectify it once corruption is rife. Black Economic Empowerment rightly seems to have created a class of rent seekers who line their own pockets rather than genuine entrepreneurs who create thriving businesses and thereby create jobs. More disturbing, perhaps, is the breath-taking lack of debate on some of the most important economic policies. Aside from the fact that ministers’ fortunes rarely (if ever) depend on performance, Parliament, with its almost built-in executive majority, looks unlikely to play this role in the foreseeable future. Opposition parties meanwhile remain weak and divided and incapable of holding the executive to account. Parliamentary committees add very little to Parliament’s teeth while the reports of the Auditor General (which have often been so late as to be irrelevant) go almost unnoticed. Public institutions such as
As stated above, Namibia has already achieved something historic. Many politicians still like to dwell on the country’s inheritance of racial strife. Yes, the poisonous legacy of apartheid remains a massive obstacle in the way of progress and keeps the country from looking forward rather than back but it must not be allowed to be the reason why progress is derailed. The reality is that Namibia enjoys a host of advantages which many other countries would envy: a long coastline, a great climate, abundant natural resources, stunning landscapes, good infrastructure, reasonable levels of public debt, a functioning civil service, a sophisticated legal and business infrastructure, friendly neighbours, and the goodwill of virtually every other country in the world. The ruling SWAPO party has enjoyed a generation in power and this looks set to continue into the distant future. Yet continuing on the same path as the last twenty-five years for the next twenty-five years is unlikely to yield anything very different: modest growth based on a vibrant mining sector that benefits the fortunate few. It could be worse. But policymakers should surely be asking: shouldn’t it be so much better? The Guide is Published by the Institute for Public Policy Research (IPPR). It covers the following areas relating to the Macro economy: Macroeconomic performance, Fiscal policy, Budget trends, Monetary policy, Employment, Poverty and Inequality. The Guide also covers the following sectors of the economy - Agriculture, Fishing, Mining, Oil and Gas, Diamond Cutting and Polishing, Manufacturing, Construction, Electricity, Water, Tourism, Transport, Telecommunications, and Banking. Other cross-sectoral issues are also addressed in the Guide are Downstream Petroleum, State-Owned Enterprises, Commercial Land Reform, the Namibian Stock Exchange and Domestic Asset Requirements, International Trade, and Black Economic Empowerment. The Guide to the Namibian Economy is available from the IPPR at the House of Democracy, 70-72 Dr Frans Indongo Street, Windhoek. Price: N$250 (N$150 to students with student cards). Further details: Salmi Shiguedha on +264 61 240514 or info@ippr.org.na
HOUSE OF DEMOCRACY Salmi Shiguedha +264 61 240514 info@ippr.org.na
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