The financial sector should increase local stakes in terms of ownership and management structures in 10 years as Government will not tolerate any incompliance or continued exclusion of locals, The Financial Sector Strategy notes.
Within the next 10 years, the banking and non-banking financial services sectors should have gone an overhaul, cutting down on financial exclusion which current stands at 31% of the bankable population.
The strategy implemented by the Namibian government is closer to the ones used in South Africa, Zambia, Zimbabwe and Botswana and will ensure that the Namibian Stock Exchange Market capitalisation will be 75% of the Gross Domestic Product; create a protection of financial safety nets; improve financial literacy and also improve local participation in both management and ownership structures of the financial sector.
Ministr of Finance, Saara Kuugongelwa-Amadhila, in her speech during the launch of the strategy in Windhopek last week said there was no need for any decision to be referred across the border.
"We should be taking certain decisions here for our people and I believe decisions in the sector taken locally are more beneficial and cater for the Namibians better,” Kuugongelwa-Amadhila pointed out.
Amadhila noted that within the NFSS the Development Bank of Namibia will get a venture capital fund to buffer its capitalisation and capacitate them for bigger projects while the soon to open microfinance bank should complement the Small to Medium Scale Enterprise loan grants as compared to competing with the existing institutions.
The NFSS will come up with a commission chaired by the Prime Minister while the advisory board, which will follow up on developments will be chaired by the Bank of Namibia and vice chairperson of Namfisa.
Bank of Namibia Governor, Ipumbu Shiimi and Chief Executive Officer of the Namibian Financial Institutions Authority, Philip Shiimi who spearhead the regularisation of both the non-banking and banking financial services sectors did not mince their word in making sure the launched FNSS will achieve the results saying there is need for stake holder cooperation.
Ipumbu Shiimi said “We should make sure that that NSX market capitalisation will be standing at 75% of GDP as compared to where we are now because it’s still a long shot. The NFSS also aims to create a depositors’ insurance scheme to safeguard the vulnerable depositors in times of anomalies and also regularise the consumer legislation in the sector.”
Philip Shiimi said: “The FNSS should not be looked as an ability for us to come up with strategy but as a reality that need to be implemented and achieve the results. We should all act by 2021 or else we will be acted upon.”
Managing Director of Old Mutual Africa Johannes !Gawaxab told The Villager that the Government’s efforts through the NFSS are commendable but it still remains to be seen whether implementation will be done and achieve the required results.
“As Old Mutual we had seen this coming already and of late out our company’s shareholding has 14% local stake. There is nothing new that government is doing as this is the trend worldwide. We have done enough to invest in skills development and we remain a major player in capital deepening in the country. Out of the N$10b worth of Government bonds we cater for two billion of that,” said !Gawaxab.
The CEO of the Development Bank of Namibia, David Nuyoma notes that if this initiative is worked as cooperation between all stakeholders there is no doubt that the ambitious target will be targeted.
“This initiative is aimed at including all population in the financial inclusion. The latest statistics showed that the financial inclusion that we have been evolving on the right track; this shows that there is hope. It will only be achieved if implementation is immediately worked on to get to those goals. It is imperative to realise that most of those strategies are not new but have been in motion, hence giving us a benchmark toward the total financial inclusion we are aiming for,” he asserted.
Nuyoma added that DBN has been evolving and already included in its strategies products to facilitate towards financial inclusion and more products are still to be added progressively.
The NFSS has been divided into targeting different priorities for a period of 3-5 years each.
The immediate priorities that were singled out as pressing and which should have been implemented by 2013 include the assessment of skills needed for the financial sector and the strengthening professional qualification through institutes.
The strategies will deal with authorities such as Home Affairs in the issuing of work permits for foreign employees with critical skills.
By 2016, leading and supporting agencies should be working together for an improved financial inclusion.
Furthermore educational institutions should review their courses in order to emphasizing on program that are relevant. Skills and training plans should be erected to enrich the financial sector skills.