June 15, 2021

AfDB approves USD 226.5 Million loan to boost Namibia economy

2 min read
Namibia registered one of the highest average growth rates in Africa over the past 20 years and made some good progress in reducing poverty.

USD 226.5 Million (ZAR 3 billion)  loan has been approved by The Board of Directors of the African Development Bank to finance the Namibia Economic Governance and Competitiveness Support Programme (EGCSP).

Charles-Boamah-600x300
Senior Vice-President Charles Boamah

The operation is the Bank’s maiden policy-based operation in Namibia and the first of two programmatic series for the 2017/18 and 2018/19 fiscal years.

“The EGCSP is designed to address emerging vulnerabilities undermining macroeconomic stability and support the Government’s ongoing bold structural reforms aimed at driving long-term job-creating growth and reducing income equality,” says Senior Vice-President Charles Boamah, who presided over the AfDB Board meeting.

Namibia registered one of the highest average growth rates in Africa over the past 20 years and made some good progress in reducing poverty.

The programme is to support the strengthening of public financial management and improve the quality and efficiency of public sector spending while laying a solid foundation for industrialisation through support to critical business environment reforms.

It is aligned with the Bank’s Country Strategy Paper for Namibia; two of the operational priorities of the Bank Group’s Ten-Year Strategy; and the High 5s agenda on industrialisation and improving the quality of life.

leopardtrkg-05-standing
Tourism creates much-needed employment for Namibia. Photo credit: Namibia Tourism Expo

AfDB, however, noted that more progress is needed to further reduce unemployment and income inequality, adding that these challenges are compounded by bottlenecks in public financial management (PFM) and the business environment, which limit the pace of industrialisation and economic diversification.

In 2016, Namibia recorded a sharp slow-down in real gross domestic product (GDP) from 5.3% in 2015 to 0.2%. As a share of GDP, the fiscal deficit at 8.3%, the current account deficit at 13.7%, and public sector debt at 39.8% had also markedly increased, while international reserves at 2.8 months of imports were below the international benchmark of 3 months.

Guided by Vision 2030, the National Development Plan, the Harambee Prosperity Plan and other sector policies and strategies, the Government has embarked on fiscal consolidation and wide-ranging PFM and business environment reforms to address these challenges and these are beginning to yield positive results.

The African Development Bank, in collaboration with other development partners, will continue to support the government’s bold steps geared towards addressing the country’s short, medium and long-term development challenges.

 

 

Leave a Reply

Copyright © All rights reserved. Newsphere by AF themes.