Windhoek – Namibia has laid down solid governance infrastructure and improved its economic performance tremendously, with GDP growing from US$3.3 billion at Independence in 1990 to US$8.9 billion today, the central bank has said.
In a public lecture, Bank of Namibia Governor Johannes !Gawaxab this week chronicled the country’s economic milestones under self-rule, adding that much had been done – and was still being done – to boost investor confidence.
The lecture was part of Namibia’s 31st Independence Day celebrations.
He said, “Namibia has a large, complex, and robust financial system made up of a balance of commercial banks and non-bank financial institutions. The strong Namibian financial sector boosts confidence for Namibians and investors alike amid challenges.
“There are high capital and reserve buffers, with banks’ minimum required capital as percentage of risk- weighted assets having been increased from 4.5 percent in 1990 to 10 percent in 2020 and actual capital and reserves nowadays standing at 15 percent. The non-performing loan ratios have remained below 7 percent since the turn of the millennium.”
Governor !Gawaxab went on: “Another feather in the proverbial hat is one of the highest levels of contractual savings on the continent that can be leveraged to provide impetus for strong and sustainable development.
“For instance, the retirement fund’s asset value including insurance policies stood at N$178 billion (US$11.9 billion) or some 103 percent of GDP at the end of 2020. It is common cause that 40-50 percent of this contractual savings are invested in the local economy with the remaining about 50-60 percent invested in foreign markets, including the Common Monetary Area and the rest of Africa.”
The BoN chief said the Southern African country’s GDP per capita was now N$54,000 (US$3,642) from N$30,000 (US$2,014) 30 years ago as part of a deliberate policy shift to foster economic development among previously disadvantaged groups and encourage entrepreneurship.
Governor !Gawaxab said Namibia had made a serious dent on extreme poverty, reducing the threshold from 63 percent to 17 percent.
“The gains have been recorded because of a combination of microeconomic policies adopted by government and the drive by relevant stakeholders which has transformed the country from a pariah state at independence to a modern country that punches above its weight in the continent.
“This is evident in terms of effective governance that it is pre-requisite for economic development and advancement. For instance the country continues to perform well on the Mo Ibrahim Index, on seventh position out of 54 countries on governance in 2020.
“Equally on global competitiveness, Namibia ranks in the top five among Sub-Saharan African countries as per the World Economic Forum Competitiveness Report.”