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Women's retreat empowers

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THE Twapewa Kadhikwa Annual Women's Retreat weekend, which aimed to activate the faith of women, as well as renew their mindsets for a more productive and prosperous future, will be remembered by those who attended as a life changer.


'Ompata' Headed to Big Screen

THE gritty reality of township life is often overlooked or ignored, but young film-maker Roger Rafael has found a way to creatively tell these stories through a YouTube series titled 'Ompata'.



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Average house prices edge up

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AT the end of March this year, the average price of a house in Namibia was N$1,2 million – about N$100 000 more than during the same time last year.


Namibians show interest in US trade

Elijah Mukubonda

SEVERAL Namibian entrepreneurs have shown interest in pursuing business opportunities in the United States after making contacts at the Namibia-US trade summit held in Namibia early this month.


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      Banks, Banks, Banks…

      by

      NAMIBIAN bankers must be smiling as interest rates keep rising and boosting their employers' bottom line, their bonus pay and overall perks.

      Worryingly, the worldwide trend that the Bank of Namibia (BoN) is forced to adopt to fight inflation is likely to only hurt the country's economy.
      At the same time it will continue to entrench a banking culture that hinders the profitability and success of local businesses, especially SMEs.
      Wittingly or unwittingly, the central bank has been complicit in keeping the Namibian economy subservient to those of others, particularly South Africa.
      But that's not entirely the regulator's fault. It is the economic system the country chose, for better or worse.
      As with other parts of the world, frustrations are growing in Namibia over whether such strong protection of banks is warranted.
      Some argue the protection all but guarantees constant profitability for the banks and a return on shareholders' equity year-in-year-out, despite the country's economy and most businesses recording a negative growth for as many as five years.
      A few years ago, the International Monetary Fund (IMF), a key adviser of the BoN, noted that Namibia's banking sector was largely funding non-productive sectors of the economy, such as property and buildings.
      “Credit is concentrated in household mortgages and in corporations operating in the non-tradable sectors, thus having limited effects on long-term growth dynamics. Enhancing credit allocations towards more productive sectors would support stronger growth,” the IMF said.
      In essence, the much-maligned IMF said the skewed funding model would not support long-term economic growth.
      But with the government having run out of cash that heated up the construction industry and attracted banks to the sector, it appears commercial banks have been diversifying their loan books, thus addressing the IMF's concern.
      In fact, the IMF may well have added that banks in particular and the financial industry in general are more geared to propping up mainly the South African economy.
      They would easily fund the wholesale and retail traders, for instance.
      Who can blame banks when their sole mandate is a healthy return for their shareholders, the majority of whom are based in the biggest economy this side of Africa?
      The BoN and other regulatory authorities are the ones with the mandate to look after the best interests of Namibians.
      Commercial banks are not known for going the extra mile simply for the sake of the economy or social harmony.
      The BoN has not done enough to let commercial banks embrace the low-income or non-banked part of the population to advance ease of transaction.
      It is unconscionable that despite the ubiquity of digital technology, Namibian banks charge no less than N$10 on a N$30 transaction.
      Banks are protected to 'recoup' their investments despite that year-in-year-out they record huge profits.
      FNB recorded a clean profit of about N$1 billion last year, Standard Bank made around N$371 million, Nedbank N$117 million, and Bank Windhoek N$900 million.
      Yet these giant institutions also compete freely in all other sectors, introducing their style of wringing costs to ensure obscene profits – even if it means laying off workers or removing a money machine from communities that need them most – or hiking cash-drawing fees.
      But they play by the rules, right?
      An innovation similar to M-Pesa, which is credited with lifting nearly 200 000 Kenyans out of poverty in a space of six years, will not succeed in Namibia because regulators favour the business model of traditional banks, which relies on high net-worth customers, high margin fees and interest rates as opposed to high volumes.
      As inflation bites with fuel prices driving up the cost of just about everything, pity the low-income earner, the small business and the far-flung villager who depends on remittances from relatives slogging it out in towns.
      We can only hope that regulators like the BoN and policymakers in the government heed the advice to do what's needed in favour of involving the majority of the population in economic activity.


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