By Emma Kakololo
Namibia continues to be burdened by poor infrastructure, despite generating excess savings over the years.
The country’s excess savings over its investments averaged N$600 million for the period 1990 to 2000, N$1,8 billion for the five years from 2000 to 2005 and N$5,2 billion last year.
Although saving by definition is a good thing, meaning people live within their means and are prepared for unexpected emergencies or major life changes, excess saving leads to foreign lending which is reflected by an outflow of capital.
In other words, the Government is prompted to source foreign investors to fund vital infrastructural projects that could just as well have been funded by local institutions.
“It looks as if we are saving ourselves into poverty and neglecting much-needed investments in the process,” said Johannes Gawaxab, Old Mutual Chief Executive Officer, when approached for comment recently.
He described the situation as “absurd” and said something needs to be done urgently.
“If we don’t invest in infrastructure such as energy, hospitals, roads, all those things that are going to be sustainable, at the end of the day, we have a lot of money but no roads. At national level, we need to get a balance between our savings and investment so that we can enjoy all this together,” he said.
“All I am saying is for companies to at least invest a portion of their excess savings into infrastructure since they need infrastructure for their businesses to prosper.”
Namibia’s economic competitiveness was recently ranked 88 out of 128 countries in the world, just behind Botswana (83), by the African Competitiveness Report, which was published by the African Development Bank (ADB), the World Bank and the World Economic Forum.
Although the report states that the quality of the country’s infrastructure was not so bad by regional standards especially with, regard to transport infrastructure such as the quality of railroads (35) and ports (30), telephone lines remained scarce (94) and sanitation coverage was still low with 13 percent rural sanitation access. Some communities are still using bucket toilets.
The report also called on the country to harness new technologies to improve its productivity levels.