Economic crisis not due to mismanagement, says !Gawaxab
Bank of Namibia governor Johannes !Gawaxab has in the strongest terms rebuked the narrative that the country is being mismanaged, adding that the high cost of living experienced in Namibia is a result of external shocks emanating from the Covid-19 pandemic and the war in Ukraine.
Speaking at a central bank public lecture in Rundu on Wednesday, !Gawaxab said the pandemic has packaged all three possible external shocks into one and thus hit the economies of countries severely - and Namibia has not been spared.
He added that the high cost of living experienced in the country - from the escalating prices of basic commodities to fuel prices - is not a result of how the country is being governed.
“These are difficult times for many people. There is a perfect storm brewing in the global economy and in our part of the world.
“So, you get recessions - that’s when the economy contracts and that is caused by demand shock, like when we had 9/11 in the United States.
“We had a financial shock in 2008 and 2009, so what Covid-19 did, it delivered all of that in a single package and that’s what we are seeing today. It’s not one shock we are dealing with and it is not a shock caused by the government mismanaging the economy or us doing something irresponsible,” he said.
External shocks
“It has nothing to do with how we as Namibians have managed the economy or that someone has been reckless. The cost of living challenges we are seeing today is a hit from outside,” the governor said.
“We are dealing with external shocks. When you understand that, I want to rebut that narrative that there is some mismanagement of the economy going on. It’s not that at all. That is why I am explaining where this is coming from.”
!Gawaxab’s sentiments come at a time when Namibians, especially civil servants, are yearning for salary increases which have not been granted for nearly seven years, despite increasing annual inflation.
The governor also used the opportunity to explain the functions of the bank to the members of the public as well as how it ensures that inflation is kept reasonable.
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Speaking at a central bank public lecture in Rundu on Wednesday, !Gawaxab said the pandemic has packaged all three possible external shocks into one and thus hit the economies of countries severely - and Namibia has not been spared.
He added that the high cost of living experienced in the country - from the escalating prices of basic commodities to fuel prices - is not a result of how the country is being governed.
“These are difficult times for many people. There is a perfect storm brewing in the global economy and in our part of the world.
“So, you get recessions - that’s when the economy contracts and that is caused by demand shock, like when we had 9/11 in the United States.
“We had a financial shock in 2008 and 2009, so what Covid-19 did, it delivered all of that in a single package and that’s what we are seeing today. It’s not one shock we are dealing with and it is not a shock caused by the government mismanaging the economy or us doing something irresponsible,” he said.
External shocks
“It has nothing to do with how we as Namibians have managed the economy or that someone has been reckless. The cost of living challenges we are seeing today is a hit from outside,” the governor said.
“We are dealing with external shocks. When you understand that, I want to rebut that narrative that there is some mismanagement of the economy going on. It’s not that at all. That is why I am explaining where this is coming from.”
!Gawaxab’s sentiments come at a time when Namibians, especially civil servants, are yearning for salary increases which have not been granted for nearly seven years, despite increasing annual inflation.
The governor also used the opportunity to explain the functions of the bank to the members of the public as well as how it ensures that inflation is kept reasonable.
[email protected]
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