‘Deglobalisation’ unpacked at local summit

The pros and cons of globalisation were in the spotlight this week.

07 February 2020 | Economics

Dennis Dykes, Nedbank Group chief economist - “You have got to create an environment where the labour force looks attractive.”

Augetto Graig – When it comes to playing successfully in global markets, the right approach is to focus where your strengths are.

This was the message of the chief economist of Nedbank Group, Dennis Dykes, this week.

Nedbank Namibia and Simonis Storm hosted their 2020 Investment Summit themed ‘Deglobalisation’ at the Safari Conference Centre in Windhoek on Wednesday. The presentations explored the consequences of Namibia’s open economy and the prospects of greater protectionism stemming from the world trend to reverse globalisation.

Presentations were given by Dennis Dykes, chief economist of the Nedbank Group; economist Indileni Nanghonga from Simonis Storm; Purvance Heuer, MD of Arysteq Asset Management; and economic analyst Dr Hoze Riruako.

Dykes presented graphs illustrating the global sentiment toward protectionism that threatens to derail the benefits of increased globalisation.

Trade in goods and services, global value chains, skills and technology transfer and capital flows through foreign direct investment and others bring benefits like specialisation in comparative advantages, countries enabled for technological leaps, more jobs and reductions in cost of living. However threats to globalisation arise due to the uneven and opaque distribution of benefits, anti-migrant sentiments, the rise of populist politics and climate change, he said.

“You have to focus where your strengths are. You have got to create an environment where the labour force looks attractive.

“The key is also to slot into global value chains. Remember protectionism is complicated, beneficiation requires a lot of electricity and we do also need low-skill, low-wage jobs. That is where careers start,” Dykes said.


Nanghonga painted a grim picture of a floundering Namibian economy where average gross domestic product fell from above 3% to -0.6% over the last four years. Gross fixed capital formation has fallen while debt servicing drains state finances.

Rising youth unemployment is a near-term problem, she said, while low inflation and negative GDP growth reinforce the case for interest rate cuts.

With Namibia’s widening trade deficit the country is ever more reliant on other nations, importing half of its goods from South Africa, and 16% from Zambia.

Namibia enjoys a trade surplus in relation to China, but the volumes don’t constitute half of what is spent importing from neighbours.

Nanghonga says ‘deglobalisation’ might force Namibia to become more self-reliant, focused on development and more innovative, but it could also spell currency volatility, reduced capital flow, reduced skill and technology migration and higher trading costs.

‘Normal weirdness’

Riruako expounded on Namibia’s energetic political landscape featuring party infighting, independent candidates and demographic polarisation.

He warned of possible disruption of the passing and implementation of policy and regulatory directives. “Political uncertainty is economic uncertainty,” he said.

Heuer’s presentation, titled ‘Normal Weirdness’, explored the unpredictability of the world’s financial system.

He noted negative interest rate policies applied in European countries, the turn in the US yield curve in 2019 and again this week, celebrity central bankers, civil unrest and technology IPOs with incredibly high valuations, hyperinflation and the impact of Donald Trump tweets.

“As asset managers we are less fazed. We follow a tried and tested process. With all the noise it helps to take a step back,” he says.

Competitive advantage

Heuer believes globalisation may have peaked. “These things happen regularly but on the long term cycle,” he said.

According to him there is no direct correlation between asset markets and protectionist policies. “What happens is a flight to safety.”

According to Heuer, “Globalisation has made Namibians brand-aware of international brands. This leads to locals competing with global operators.”

“Namibia needs to find a competitive advantage. Diversify without diversifying the return. Actually it is only the US that is ‘deglobalising’. We should target the right consumers like China and Asia who are globalising.”

[email protected]

Similar News


Growth is back, says Calle

3 days ago - 21 February 2020 | Economics

Augetto Graig Despite the legislative framework for public private partnerships (PPP) being in place, not a single such project is on the finance ministry books.“Why...

Covid-19: SA at ‘high risk’ of virus

3 days ago - 21 February 2020 | Economics

South Africa, Egypt and Algeria are at high risk of suffering from the deadly coronavirus, a study released Wednesday suggested.The Lancet medical journal reported that...

BoN: Coronavirus an ‘unfolding catastrophe’

3 days ago - 21 February 2020 | Economics

Jo-Maré Duddy - The coronavirus is a “catastrophe that is still unfolding” and it is too early to estimate its impact on Namibia, the governor...

Covid-19 slows Belt and Road push

3 days ago - 21 February 2020 | Economics

Keith Zhai and Matthew Tostevin - When president Xi Jinping made his first state visit this year to Myanmar and signed new infrastructure contracts, there...

Pandemic bond under pressure as virus spreads

3 days ago - 21 February 2020 | Economics

Karin Strohecker - A World Bank bond designed to deliver funding to help the world's poorest countries to tackle fast-spreading diseases has lost half its...

'Party's over,' Shiimi tells consumer

4 days ago - 20 February 2020 | Economics

The latest cut in interest rates is to help create a conducive business environment to boost economic growth, not to encourage more consumption-driven borrowing among...

China craving for Senegal peanuts rattles local business

4 days ago - 20 February 2020 | Economics

Large peanut orders from Chinese traders have cut Senegal's traditional selling season short this year, rewarding farmers with fat profits but leaving local buyers with...

Pompeo takes swipe at Beijingin Addis

4 days ago - 20 February 2020 | Economics

Robbie Corey-Boulet - US Secretary of State Mike Pompeo yesterday closed a three-nation Africa tour with a thinly-veiled swipe at China as he talked up...

Africa Briefs

4 days ago - 20 February 2020 | Economics

Zim threatens to withdraw mining licencesZimbabwe has given holders of mining concessions up to the end of April to pay US$11 million in outstanding annual...

D-Day for interest rate cut

5 days ago - 19 February 2020 | Economics

While the majority of analysts expect the Bank of Namibia (BoN) to drop its repo rate today, they also agree that lower interest rates are...

Latest News

Remove me first – Katrina

2 hours ago | Crime

Former education minister Katrina Hanse-Himarwa, responding to the hullaballoo over her appointment to the parliamentary standing committee on legal affairs, said those pained by her...

Fishcor not our baby –...

2 hours ago | Crime

Acting minister of fisheries Albert Kawana has washed his hands of any responsibility to deal with the under-pressure board of Fishcor, saying the matter is...

They don't learn, do they?

2 hours ago | Opinion

Swapo drew the ire of the public, including its own members, following reports that its member of parliament and former minister of education Katrina Hanse-Himarwa...

Big ups to NSC and...

2 hours ago | Sports

I must congratulate the Namibia Students Financial Assistance Fund (NSFAF) and the Namibia Sports Commission (NSC) for signing a memorandum of understating. It is a...

NRU calls up 47 players...

2 hours ago | Sports

The Namibia Rugby Union (NRU) has called 47 players for a training and trials camp in preparation for the 2020 edition of the Under-20 (U20)...

Fishrot shows the worst in...

2 hours ago | Crime

Finance minister Calle Schlettwein has once again condemned the Fishrot corruption scandal, calling it one of the most unpleasant incidences of 2019.Schlettwein was addressing his...

Disgruntled members close Swapo regional...

2 hours ago | Politics

Some 300 Swapo members, led by businessman Sigo Amunyela, last Friday afternoon closed the Swapo Party Oshana regional office at Oshakati after asking the office...

Authorities not pursuing 'missing' Fishrot...

2 hours ago | Crime

The Anti-Corruption Commission and the Namibian police have not put in a request for the apprehension of Mare´n de Klerk, a lawyer linked to the...

Simataa Mwiya praises NSFAF

2 hours ago | Sports

Jesse Jackson Kauraisa Namibia Students Financial Assistance Fund (NSFAF) and the Namibia Sports Commission (NSC) have signed a memorandum of understating which will...

Load More