WINDHOEK- President Hage Geingob, in his State of the Nation Address (Sona) yesterday, said Namibia today is in a better position than it was a year ago.
This, the President said, was primarily because of the now strengthened underlying economic fundamentals.
“The fiscal consolidation strategy has adjusted expenditure downwards over the term, from 42 percent of GDP in 2014/15 to 34.9 percent of GDP in 2018/19; this is a 7.9 percent reduction,” he said in his two-hour address to the nation.
He said although deep budgetary cuts triggered other forms of economic implications, the intervention helped to stabilise the fiscal position and steered the economy onto a path of sustainable growth.
Illustrating the positive effects, Geingob said total spending on subsistence and travel (S&T) allowance was reduced by 62.3 percent over the period, from N$634 million in 2015/16, to N$221 million in 2018/19.
According to Geingob, in 2018 government maintained international reserves sufficient to cover four to five months of imports, which is the highest level of import cover Namibia has had since independence.
“The economy is emerging from a protracted technical recession, and is forecasted to grow by 0.2 percent in 2019 and a further projected growth of 2.2 percent by 2020,” Geingob said.
He said in 2015/16 the country’s public debt stock was 25 percent to GDP, rising to 49.2 percent of GDP in 2019/20.
“This high debt stock has been channeled to stimulate economic recovery and job creation,” he said.
Geingob says although Namibia has exceeded her self-imposed ceiling of 35 percent debt to GDP, the country remains below the Southern African Development Community (Sadc) benchmark of 60 percent debt ratio.
He said Namibia’s improved ranking as the fourth most competitive economy in Africa, is indicative that current regulatory reforms are taking shape.
“Government has provided certainty on key policy areas, including land ownership by foreigners, economic transformation framework and manufacturing incentives,” he said.
He said reforms to conduct a public service bureaucratic bottleneck audit; business-registration-process reengineering and the establishment of a labour productivity centre, will over time improve efficiencies, build trust and boost overall investor confidence.
“Investment is picking up and our sustained promotional efforts are paying off,” he said.
He said that according to the Namibia Investment Centre, a minimum of 34 domestic and foreign direct investment projects were secured over the term, worth a total N$2.65 billion and generated 1,601 new jobs.
Also, he said, according to the Namibia Statistics Agency (NSA), a total 48,857 new jobs were created nationally in 2018, with the greatest contribution coming from the agricultural sector, which saw modest recovery during the 2017 rainy season.
Regrettably, Geingob said, the recurring drought threatens to reverse these gains.
He said that in March 2019 he appointed a ‘High Level Panel on the Namibian Economy’, tasked to identify opportunities for economic recovery and mass employment creation, by leveraging private sector capital.
“An immediate deliverable for this eminent panel will be to coordinate the hosting of a one-day Economic Growth Summit in July 2019,” the President said.
The Presidential Economic Advisory Council (PEAC), he said, has been reconstituted into the High Level Panel, to reflect changing priorities and emerging opportunities.
“One enabling legalisation to leverage private capital investment into development projects, is the Public Private Partnership Framework, which has been in force since December 2018,” Geingob said yesterday.
2019-04-18 09:17:53 4 months ago