SADC must tighten fiscal policy

23 July 2019 | Africa

Finance minister Calle Schlettwein has lamented the financial struggles currently faced by the African continent, adding that economic outcomes are far from uniform in sub-Saharan Africa.

Oil exporters, he said, are still dealing with the legacy of the largest real oil price decline since 1970 and debt levels are rising in some countries, while other countries are suffering from internal conflicts.

Speaking at the at the opening of the SADC Committee of Ministers of Finance and Investment Meeting in Windhoek on Friday, Schlettwein emphasised that global economic growth has weighed down on the SADC region with economic growth estimated to have improved marginally from an average of 2.9% in 2017 to an average of 3.1% in 2018.

He added that annual inflation rates eased in general, with only three member states recording a double-digit level rate and added that in the fiscal sector, debt and vulnerabilities remain elevated in some countries. According to him, weaknesses in public balance sheets are also weighing on countries' external positions, with reserve buffers below levels typically considered adequate in more than half of the countries in the region.

He also noted that the size of the current account deficit widened in 2018 as the region is highly vulnerable to terms-of-trade shocks, and these have a large impact on current account positions, mainly through the trade balance.

“In this context, avoiding policy missteps that could harm economic activity should be the main priority. Macro-economic and financial policy should aim to guard against further deceleration where output may fall below potential and to ensure a soft landing where policy support needs to be withdrawn. At the national level, monetary policy should aim to keep inflation on track toward the central bank's target and to keep inflation expectations anchored.

“Fiscal policy will need to manage trade-offs between supporting demand and ensuring that public debt remains on a sustainable path. In particular, where fiscal consolidation is needed, policy should calibrate its pace to secure stability without suppressing near-term growth and harming programmes that protect the vulnerable,” he said.

Schlettwein also pointed out that as such, policies should aim at diversifying economies including the identification of new sources of growth.

“In the fiscal sector, policies should aim at domestic revenue mobilisation and expenditure rationalisation by focusing public investment decisions on areas that are growth-oriented rather than consumption-oriented. These efforts require the region to act collectively and devise and implement medium and long term measures,” he urged.

JEMIMA BEUKES



JEMIMA BEUKES

Similar News

 

Namibian companies consider AfCFTA boon

3 months ago - 19 November 2019 | Africa

CATHERINE SASMANNamibia recently signed the African Continental Free Trade Agreement (AfCFTA) that could potentially unlock the massive African market of 1.2 billion people as the...

Small burial for Mugabe

4 months ago - 30 September 2019 | Africa

The body of Zimbabwe's former president Robert Mugabe was buried on Saturday in his rural village of Kutama, an AFP reporter at the scene said.The...

Another dos Santos falls

4 months ago - 30 September 2019 | Africa

One year ago, the dos Santos family handed the Angolan presidency over to Joao Lourenco. The new president promised to tackle corruption which crippled the...

South Africans are not xenophobic

5 months ago - 17 September 2019 | Africa

South African president Cyril Ramaphosa has apologised for the violent attacks by South Africans against nationals of other African countries, saying South Africans are not...

Mugabe: Hero or zero?

5 months ago - 16 September 2019 | Africa

Some believe the late Robert Mugabe was thrown into the dustbin of history when he was deposed as president of Zimbabwe in 2017, yet many...

Mugabe: Liberation hero turned despot

5 months ago - 06 September 2019 | Africa

Robert Mugabe, who has died aged 95, used repression and fear to hold on to power in Zimbabwe for 37 years until he was finally...

Namibia urges vigilance after SA attacks

5 months ago - 03 September 2019 | Africa

The Namibian High Commission in South Africa has issued an advisory, urging countrymen and women in and around the Gauteng Province to be vigilant following...

Strengthening news from the sub-region

6 months ago - 20 August 2019 | Africa

The Southern African Broadcasting Association (Saba), in partnership with the national broadcasters of countries in the region, officially commissioned the Eye on SADC news programme...

Bureau Veritas inspires

6 months ago - 16 August 2019 | Africa

Bureau Veritas Southern Africa, the global leader in testing, inspection and certification, continues to spark interest in the southern African professional working environment. The company...

SADC condoles with Tanzania after fuel tanker...

6 months ago - 11 August 2019 | Africa

Outgoing SADC chair President Hage Geingob has extended condolences to the government and people of Tanzania over the victims of a fuel tanker explosion, which...

Latest News

State piles more charges on...

13 hours ago | Crime

OGONE TLHAGEAdditional charges have been piled on top of those that the so-called Fishrot Six already face. The new charges exclude the sixth accused Ricardo...

We didn’t know – Fishcor...

13 hours ago | Crime

STAFF REPORTERSNational Fishing Corporation of Namibia (Fishcor) board members have pleaded ignorance of the alleged grand thievery that occurred right under their noses at the...

Nahas waxes lyrical on Fishrot

13 hours ago | Politics

Former prime minister Nahas Angula says the ruling party Swapo, for which he served as a central committee member, must explain its alleged links to...

Africa Briefs

13 hours ago | Economics

Moody's cuts SA’s GDP growth forecastRatings agency Moody's has cut its 2020 growth forecast for South Africa to 0.7%, saying the economy remained stuck in...

The baby and the bathwater

13 hours ago | Opinion

The idiomatic expression “don't throw the baby out with the bathwater” comes to mind when debates start stirring on social media regulation.This idiom describes an...

Company news in brief

13 hours ago | Business

Anglo Plat’s earnings soarChief executive Chris Griffith said on Monday he will step down in April from the helm of Anglo American Platinum (Amplats), which...

Judiciary hits back

13 hours ago | Justice

The Office of the Judiciary has defended itself against “undue attacks”, including a Landless People's Movement (LPM) allegation that it has been captured by the...

Former cop arrested for growing...

13 hours ago | Crime

A 27-year-old former police officer was arrested for the cultivation of dagga plants and the possession of ammunition without a licence at Ondangwa over the...

US donates food for HIV...

13 hours ago | Health

Due to the devastating drought, many people on antiretroviral therapy (ART) struggle to take their medication without adequate food.Up to 96% of Namibians who have...

Load More