Inequality is a key concern but what can the industry propose to bring an amicable solution to it?
If inequality had a cure, it would be “in popular demand”, inequality in economics is similar to cancer in medicine, if blocked here it spreads over there.
NEEEF was condemned by various people in the business fraternity, hence Namibia needs a tangible resolution to address empowerment and ownership? We must firstly agree that there is deeper inequality among the black people in Namibia but there are different socio-economic, political, educational, commercial reasons and land issues for this discourse. I see NEEEF as a political cocktail filled with all kinds harmful narratives that are catastrophic and it needs greater accuracy to eradicate inequality. There is need for public and private sector to deliberate how to resolve inequality to safeguard the poor and deter the hazards of extreme poverty towards national development goals. Every patriotic Namibian must embrace to concept of empowerment, equitable smart partnerships regardless of a person’s race to avoid impediments of social decline. Our sizable geometry is suitable for inclusive policies for both black people and white people without taking company shares in an existing businesses, because 100% of the poor depend on the financial wellbeing of their white/black owners.
One cannot achieve empowerment and ownership without diligently applying the instruments of fair wealth distribution and inequality, else we are heading for a sinkhole.
Transparency and racial equality instruments- A transparent policy must promote equality without discrimination for all races, tribes, etc, including the minority San community. Clearly NEEEF has not taken this in consideration and we will suffer the consequence of any unforeseen hidden motives that’s has invalid technical justification. The policy needs to clarify its position towards regional and international trade protocols and how trade will be affected, (for instance between us and RSA and the Chinese). There is need to check compliance with the Most Favoured Nation(MFN) principle of the WTO compliance else a white person from a multinational company or public trading company in Canada will not be bind to the rules of the policy in the current condition, whereas the local white person will be limited.
Inequality Instruments – Renowned Economists Joseph Stiglitz and Jeffrey Sachs inspire us resolve inequality and enhance equitable wealth distribution, their biggest concern is that globalization will harm economies and people’s standard of living immensely if unchecked. Our country’s Gini-index and Lorenz curve shows that 40% of the people have a better standard of living while 60% of the people live 20% of national income average, which is quite disastrous for a nation like ours. According to the curve 10% of the people is in control of more than 50% or half of national income. According to NSA 2010 survey the Erongo is the poorest region, followed by Khomas, Omusati, Oshana, Karas, Kunene and Hardap. The GDP per capita is Approximately N$ 55 000 per person, which is high and I will double this figure to add import-export revenue flows of N$ 160 billion (approx). I think we are a wealthy state.
Globalization Instruments – it increased automated production causing millions of people to lose jobs globally and people depend on handouts of taxes paid by the rich causing a dependency syndrome to promote dominance of the elites. Due to this phenomena economic woes are tied to mainstream economies but we cannot neglect one of the key trade survival techniques of food production, for that people need fair ownership of land. Globalization effects will fail to harm economies if nationals have access to basic needs, land, water and food according to UN Sustainability goals.
Domestic Investment Instruments – The trade flows in-and-out of Namibia is approximately N$ 160 billion (which I note as the value of money we spend on trade goods, both imports and exports and this is not GDP). Our trade expenses rules in favour of multinational companies. On top of this we have unlisted investment moneys, national savings and etc, some have liquid cash others have assets, “we have fully-loaded fortune-bus in Namibia”. A good domestic investment policy attracts domestic and foreign investors and boost trade and job creation within the economy. Developed countries have more interventionist policies that gives protection to their currency and money controls but there are drafted with caution, we can also not afford to back-off from such positive reform. The investment act can be rolled out using stronger commercial instruments but it will need a lot of cash injection to match industrial demand.
SME Development – SMEs make up majority of businesses registered in Namibia and some companies with good potential require support and development to assist their growth. The government benefit from the trade carried out by SME, therefore they can be the invisible hand that help potential businesses to grow in the field of interest. They compete in a world where imports are preferred over local produce. A country cannot grow without having functional, subsidized and well monitored SME development policies. The Ministry of Industrialization, Trade and SME Development must affirm its position on being the commercial arm of the nation that takes ownership of investment subsidies, innovation and strategic partnerships. This way most locals will have the chance to own stable companies that depend on government procurement system where suitable. Sadly, most SME do not engage in Agriculture by choice. They also trade in the smallest economic sectors because they are excluded marginally from value addition in the Primary sector where they can grow exponentially.
Access to Natural resources and land as Instrument of Equality – the government must be accountable for ensuring equal representation of resources to all Namibians without equally, efficiently and reliably. Natural resources constraints are not linked to white people because very few whites barely own mines or resource rights in Namibia, while big mines are linked with multinational companies that have the financial capacity to operate them. I lament over the status of the invisible Evatelo mining arm. The mining sector must draft its own sector charter but on fairness to boost black ownership in Mining. Thus NEEEF cannot influence all sector as it is not the same approach in all, for example once cannot just acquire shares in a family owned small store because of NEEEF. Sectoral reform without fair funding is also a gravy train.
I am positive about Namibia’s economy and I am optimistic that growth will manifest and I believe firmly we can penetrate other African regional blocks that are linked to our growth. God bless
Rodney Dan-Ao !Hoaeb is a Trade and Investment Researcher Committed to seeing a radical economic shake-up in Namibia.