This year’s budget offers some relief for Namibia in a global economy where populism, nationalist and protectionist rhetoric are getting increasingly louder, forcing developing nations to relook at ways of doing business to grow their economies.
Going forward, as reflected in this year’s budget theme, we are no longer pounding on about job creation on its own, but focusing on sustainable development through which meaningful jobs can be created.
Compounded by projections of contracting economic growth over the next year, Namibia needed to ensure the domestic economy is well anchored on fiscal safeguards; that the macro-economic fundamentals are in place to withstand as severe an economic cyclone as the one that hit us last year.
This is well captured by the figures presented to parliament, especially for the next three years public spending will remain within the scope of the money available in the state kitty.
We have moved away from the spending habit that takes care of today, only to worry later about where the money would come from.
It is encouraging to hear Finance Minister Calle Schlettwein tell fellow lawmakers of sustainable development in reference to the budget, emphasising that the quest to attain development should never be at the cost of depleting national resources and thus bequeathing insurmountable debts to our children.
“Our children should never be worse off than we are,” Schlettwein said.
What the shape of the budget also tells us is that Namibia has learned some very hard lessons last year when the country had to literally scrape together its last pennies just to keep the creditors at bay.
Thus gone is the spending on non-productive edifices around the country. Money would go to productive public infrastructure and, even then, that infrastructure will be funded according to a clear priority list, based on the availability of funds.
The main theme that kept reverberating throughout the budget speech, that from today onwards the priority is to protect and preserve the country’s hard-won macroeconomic stability by curtailing excessive growth in non-core, recurrent and capital expenditure.
Indeed, the State has funded enough head offices and buildings for ministries and state agencies.
The thinking – and we hope this rationale would prevail for the next decade or so – is that if a road is to be funded, the prior question is how would it contribute to poverty alleviation and increased revenues.
This is much-needed long-term thinking and a radical departure from the old rationale of looking at the number of (temporary) jobs only that could be created during the construction phase of infrastructure projects.
If anything, the lessons learned last year are that we cannot afford to have short-term approaches with our hard-earned cash, especially not at a time when the country’s overall wealth is growing at a very low rate (1,3 percent growth in 2016).
We have learned that things do not always go as well as planned and that when things do go wrong we should have a strong economic foundation to withstand the storm.