November 01, 2024
Economy

Namibia poised for an economic boom – Steytler

April 06, 2023
Namibia poised for an economic boom – Steytler

Namibia is on track to experience seven years of an economic boom, according to former Presidential economic Advisor, John Steytler.

Steytler emphasised the need for business reforms to sustain the growth. He pointed out that required business reforms must be implemented for economic growth to be achieved.

“We have already begun to enter seven good years in 2022, and while some economists may disagree, there are increasing signs that the recovery is on track. For example, last year we discussed green shoots, which are becoming more visible,” Steytler told a recent event in Windhoek.

Steytler's sentiments come as Namibia expects economic growth of 3.2% in 2023, down from an earlier forecast of 3.4% reflecting lower mining output estimates this year according to the Ministry of Finance and Public Enterprises. However, Steytler said the primary surplus – for the first time in a while – from the national budget is encouraging.

“What this means is that if we can continue with the trend, eventually our debt will start to calibrate. I think that with the economy growing and primary surpluses and increased diamond production, we are entering a very good space of recovery,” he said.

Despite geopolitical tensions, Steytler observed that there were encouraging signs of recovery projecting growth for the tourism and mining sector.

“There are some sectors that are not at pre-Covid levels, considering that many of the sectors we have seen are at pre-Covid levels. The tourism industry is one of the sectors showing good recovery, despite not yet reaching pre-Covid levels. If things continue as they are, we should see more and more recovery, but we must not forget that we are still suffering from 'LongCovid,' which people who had Covid experienced. The same is true for the economy," he said.

However, Steytler emphasised that some of this good improvement won't be felt right away, particularly at the individual level.

“There are a lot of positive things happening in Namibia right now, but the question is what we will do with this recovery and whether we will use the seven prosperous years to prepare for the seven lean years that will come after. Income peaked in 2015, and it will still be a few years before we return to income levels from that year,” he reiterated.

Reforming the business environment is one thing that needs to be done quickly in order to stabilise the economy, according to Steytler. This includes monitoring spending habits and the public-private sector involvement in the administration of state-owned enterprises.

Steytler said state-owned enterprises should follow a business model used by Debmarine Namibia, which involves joint ventures between the public and private sectors.

“If more SOEs followed this model, success stories like Debmarine and MTC might be more observed. We can allow the private sector to help the government run state-owned enterprises in a manner akin to how Debmarine is run if we take the risk of reducing some of the ownership in the state-owned enterprises we currently have. Additionally, if we look at MTC, where the public and private sectors work together, we see better results than just state growth," he said.

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Last modified on Sunday, 09 April 2023 00:38
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