By Josef Kefas Sheehama
Even though digital spaces are becoming more prevalent, many people are struggling to comprehend them because they lack in-person interactions. We relied on emotional bridges to compensate for the loss of physical proximity. It appears that our most human qualities were revealed when we were kept at a distance.
The Namibia Statistics Agency recently released national account figures showing a more positive economic momentum. The GDP rose from N$174.2 billion to N$181.9 billion in 2021, according to national account figures. The GDP grew by 2.7 percent in 2021, according to official estimates. The government must deliver against high expectations to reduce policy uncertainty and advance structural economic policies that can boost the country’s economic growth potential. As a result of the gradual removal of COVID-19 barriers, our economy rebounded. Our economy has benefited from smoother movement of people between countries. Several reform scenarios are being simulated and their impact on jobs, poverty, and inequality is being examined. The data shows that capital investment grew by 14.3% in Namibia in 2021, compared with 13.4% in 2020. This is hopeful news.
Spending on food, housing, and other items by Namibia’s consumers exceeded 75% of the economy’s GDP in 2021, up from the year before. Private consumption, which includes any purchase made by consumers, such as food, housing, and energy, refers to durable goods such as cars but not house purchases by households. It is the largest part of the economy and thus drives economic growth. The economy is influenced by government spending, which falls by 0.30% in 2021. Government expenditure is critical in influencing the economy. It contributes to aggregate demand in addition to household consumption, business investment, and net exports. The economy will be affected by any changes. An economy grows at a higher rate when aggregate demand rises, rather than decreases as a result of a government spending cut. The government can thus play an important role in responding to the financial slowdown and its consequences on the economy by increasing its spending to stimulate economic growth.
Going forward, I believe that only businesses that are capable of dealing with sudden increases in demand, sudden changes in the market, and disruptive business disruptions will be successful in the new normal. At the same time, businesses with large investments in technology and agile innovators alike must maintain a sense of community and shared culture by balancing technology adoption with creative strategies. Businesses must quickly adapt their operations to meet the new normal in a competitive, technological economic, and social environment. This is also the time for businesses to consider the future of their businesses and, if possible, divest non-core or underperforming assets to maintain a portfolio that is both efficient and valuable. To innovate and make strides, Namibian businesses must do so now. Employees should be given high priority in assisting them to cope with the already difficult times. A firm can reinvent itself to better serve consumers, adapt to a digital world, and become more agile in operations as a result of this moment. Change is always challenging, especially so for organizations that are willing to transform.
Additionally, several commonalities present themselves to businesses of all sizes. What are some of the most significant opportunities and shifts that will shape the future business landscape and how might companies take advantage of them? Diversification may be your solution. If your business has no safeguards in place in case of an economic downturn, it may be doomed. Before diversifying, you should ensure your firm’s capital and resources are stable. Your core business should initially provide the resources for diversification. Even a long-established firm may be in trouble if it has too many resources. A firm must have not only the authority but also the ability to move things forward.
Moreover, economic control is not merely control of a sector of human life that can be separated from the rest, it is the control of the means for all our ends. Therefore, the National Development Plans are very important in redefining the future of Namibia’s Economic recovery and growth plan. Proper implementation of the National Development Plans would restructure the economy and could put the country onto a sustained higher growth path. We now need to look at public policies to ensure that these benefits become permanent. Having been catapulted into the digital future, we must make the most of this opportunity by doubling down on digital transformation. Investing in new digital capacities, infrastructures, and technologies will be a key element of the recovery effort. We have gone through an accelerated digital learning cycle due to the pandemic. The government, by involving the private sector in the new normal will have a partner that is focused on maximizing profits from operating and maintaining the infrastructure. Furthermore, Inflationary pressures are expected to rise in 2022, and the Bank of Namibia will continue to tighten monetary policy, further tamping down inflation expectations. The fiscal deficit and public debt levels are expected to remain elevated as the government implements its ambitious economic recovery program and limits the fiscal space needed for infrastructure and human capital investment.
To that end, in this time of unprecedented change, there is a very real element of societal transformation that we can expect, with a more direct impact on how we live and work. But adapting to this new normal requires a collaborative effort that calls for unity between the private and government leaders. The question is: are we ready to be bold and take a long-term view, to drive progress for a healthy, economic future?
Therefore, the time to reinvent and innovate Namibia’s economy is now.