economic crisis

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24.02.2012

Opportunities in current economic crisis

By: RENIER VAN ROOYEN

THE economic crisis has had a profoundly negative impact on economies, standards and quality of life the world over. It does, however, also present opportunities, at a local level in particular.

The crisis emphasises the need for efforts geared towards sustained socio-economic development; and herein lays the opportunity.
Because key growth indicators such as trade and exports slow down during times of economic downturn, countries are forced to take stock and consider aspects that will contribute to lasting development programmes.  
Such consideration raises the question as to whether enough is being done to advance the pillars of the economy, particularly education, industry and infrastructure development.
With the focus on the fundamentals of economic advancement, countries become more inclined to direct resources towards these sectors.
The anticipated impact of the financial crisis on a number of developing countries may entail a combination of collapse of financial systems and structures, which impedes lending activity, a general slowdown in exports and interruption in the flow of financial resources to these countries.
Namibia, to a large degree, has been sheltered from these threats.
It has a strong financial system, there is sufficient capital available in the local market, and it is not totally export-dependent. The recent Euro bond issue also confirms that the country is capable of sourcing funding and attracting investors in the current economic context.
Drawing on this advantage, by consolidating the pillars of socio-economic development instead of merely focussing on regular consumptive patterns, can place Namibia in a position not only to participate more meaningfully in the global economy once it recovers, but to present a model for development that can be replicated in the rest of Africa.
Programmes such as the Targeted Intervention Programme for Employment and Economic Growth (Tipeeg) are important instruments in this scenario as it focuses on the critical elements that need to be put in place during the course of the crisis, for Namibia to emerge as a continental leader once the crisis subsides. 
The Development Bank of Namibia (DBN) aligns its strategy with the policy of decentralisation, which involves development of social infrastructure in rural and unproclaimed areas among others.
Namibia is in a position to invest in social and physical infrastructure and to advance key sectors such as manufacturing. This is due to the availability of funds in the economy that may  not be applied optimally at present as a result of the notion that Namibia lacks development opportunities and projects.
There is sufficient opportunity to initiate significant development projects. There are also sufficient resources, and recognition of the need for advancement of these projects.
What is required, however, is coordination of the effort to achieve long term benefit for our nation. So it is imperative that the different stakeholders tasked with socio-economic development be brought together for the country to achieve this goal.
If this approach is followed prudently, we can expect sustainable wealth creation in Namibia. This wealth will increase value at a national level, with the resulting financial stability enabling the country to draw even more foreign direct investment. It will also improve living standards significantly.
I believe that Namibia is uniquely placed to successfully implement development programmes with enduring benefit.
The country’s solid infrastructure base provides it with a definitive comparative advantage and, if harnessed, can see to Namibia sharing its experience in addressing complex development challenges, with the rest of the continent.
Namibia has an opportunity to get it right if it has the courage to seize the moment that the current economic crisis presents. By seizing the moment during a particularly bleak phase, it can become a beacon of light; with tangible benefit for its citizens and those in other parts of Africa.