Namibia, Finland Set Up Credit Scheme

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By Frederick Philander WINDHOEK The purchase of health equipment for Namibian hospitals and clinics to help improve government health care service delivery is one of a number of the public sector projects that can benefit from a concession credit agreement signed on Friday between the governments of Finland and Namibia. The Finnish minister of Foreign Trade and Development, Mari Kiviniemi specially came over to sign the agreement between herself and the Namibian minister of Finance, Saara Kuugongelwa-Amadhila. “Not only is the relationship between Namibia and Finland framed through agreements and contracts, but it is also marked by many projects, personal involvements, individual friendships and political solidarity. Therefore, it is hoped that following the signing of this memorandum of understanding, we will witness a series of projects that are pro-poor and pro-growth from which the Namibian people will benefit,” said Kuugongelwa-Amadhila after signing the agreement. The credit scheme is a soft loan instrument provided by the Finnish ministry of Foreign Affairs to lower middle-income and low-income countries with a repayment period of 15 years. “This memorandum of understanding will provide both parties with a framework through which financial and technical assistance can be channelled and structured. It is a first step on a new road and I am convinced that it will be the basis for many more cooperation agreements to come,” she said with reference to a Finnish business delegation representing 12 companies that accompanied the Finnish minister. Kuugongelwa-Amadhila told the visitors that the country has made great progress since Independence in addressing inequalities and creating the foundations for broad based development in the future. “However, a series of challenges remain. We need to be more effective in the fight against poverty and the HIV/AIDS pandemic. Therefore, any development strategy needs to embrace pro-poor growth. Job creation through investments into new projects is important to lift people out of poverty. We have to continue diversifying our economy, and partnerships between Finnish and Namibian businesses are important to strengthen the entrepreneurial capacity of Namibians,” she stated. In a short speech, the Finnish minister applauded the fact that Namibia has been the first African country to sign an agreement to this effect with her government. “Concession credits can be granted to low-income and lower middle-income countries to support their social and economic development. The recipient of the credit pays either zero interest or the interest rate is clearly below the reference market rate of interest. The interest subsidy is paid out of Finland’s official development cooperation funds,” Kiviniemi explained. She expressed confidence in the credit scheme to develop in a win-win relationship between Finland and Namibia on a practical economic level. “I would like to encourage the government to build the infrastructure and gain technology and know-how that will help Namibia become more competitive in its own fields of specialization. In this concession, credits can play an important role, serving as a significant springboard to development. The scheme is also considered to be an important vehicle in promoting commercial cooperation and trade between our two countries in a pragmatic manner,” she said.