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Academics unravel the budget

The budget release has been received with a mixture of sighs and relief over the past week with the recent announcement being the centre of much economic analysis.
University of Namibia (UNAM) lecturers also joined in the wave of discussions sharing their opinions with the Economist. “My opinion on the overall budget is that it strikes a good balance. It reflects priority and enhancement. Priority in the sense of what needs to be done to drive the economy forward in order to enhance the social welfare of the nation,” said Mr Peyavali Sheefeni, Senior lecturer of economics at UNAM.
Mr Sheefeni further explained that the budget’s financing seems to be well balanced with no particular emphasis on either debt or tax financing. “In my opinion, there are calculated risks. There is balance between containing budget deficit at the same time relieving individuals of corporate taxes. One can clearly see that the budget does not lean on any of the two financing ways. To be frank, Namibia has a history of financing its budget mostly by borrowing from the domestic sources.”
His stance towards the new budget was further highlighted with some other key actions that the government has taken, “There has been so much outcry regarding housing problems coupled with high property prices. This budget is first of its kind to encourage people to invest in properties. This is reflected in actions such as reduction in property transfers and duty rates. This is indicative that government is committed towards addressing housing issues as much as other problems.”
Dr Omu kakujaha, also a senior lecturer at UNAM, expounded on the new budgetary allocations. He first noted that in general, the expansionary budget was expected. He explained that the placement of the environmental levy and the export levy on raw materials were both predictable. “As to how much the expansionary measures will contribute to economic growth and job creation will depend on many other factors (local and global).” In the same cautionary manner, he affirmed the continued prominence of TIPEEG in the budgetary allocations.“As for me the jury is still out as to its contribution. We haven’t seen the numbers yet. The performance indicator they have chosen, that is, the number of jobs created, is not a good measure. One should try to compute the multiplier effect of the TIPEEG funding and not strictly rely on the jobs created. Now it has put them under a lot of pressure to justify why very little jobs were created. There is one weakness though, and that is the low execution rate – which is symptomatic of government.”
In conclusion, Dr Omu explained that the actual implementation of the budget will still depend on several pertinent factors. He mentioned that there is the factor of human capacity. Specifically, he drew attention to the mixed set of skills which will be instrumental in budget instrumentation. “There should also be less red tape. The procurement procedures need to be simplified without necessarily neglecting checks and balances.” He also alluded to the leadership process within the country, “Get governance right: punish lazy and corrupt bureaucrats and political office bearers (ministers) and reward good work.”

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Following reverse listing, public can now acquire shareholding in Paratus Namibia

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20 February 2020, Windhoek, Namibia: Paratus Namibia Holdings (PNH) was founded as Nimbus Infrastructure Limited (“Nimbus”), Namibia’s first Capital Pool Company listed on the Namibian Stock Exchange (“NSX”).

Although targeting an initial capital raising of N$300 million, Nimbus nonetheless managed to secure funding to the value of N$98 million through its CPC listing. With a mandate to invest in ICT infrastructure in sub-Sahara Africa, it concluded management agreements with financial partner Cirrus and technology partner, Paratus Telecommunications (Pty) Ltd (“Paratus Namibia”).

Paratus Namibia Managing Director, Andrew Hall

Its first investment was placed in Paratus Namibia, a fully licensed communications operator in Namibia under regulation of the Communications Regulatory Authority of Namibia (CRAN). Nimbus has since been able to increase its capital asset base to close to N$500 million over the past two years.

In order to streamline further investment and to avoid duplicating potential ICT projects in the market between Nimbus and Paratus Namibia, it was decided to consolidate the operations.

Publishing various circulars to shareholders, Nimbus took up a 100% shareholding stake in Paratus Namibia in 2019 and proceeded to apply to have its name changed to Paratus Namibia Holdings with a consolidated board structure to ensure streamlined operations between the capital holdings and the operational arm of the business.

This transaction was approved by the Competitions Commission as well as CRAN, following all the relevant regulatory approvals as well as the necessary requirements in terms of corporate governance structures.

Paratus Namibia has evolved as a fully comprehensive communications operator in Namibia and operates as the head office of the Paratus Group in Africa. Paratus has established a pan-African footprint with operations in six African countries, being: Angola, Botswana, Mozambique, Namibia, South Africa and Zambia.

The group has achieved many successes over the years of which more recently includes the building of the Trans-Kalahari Fibre (TKF) project, which connects from the West Africa Cable System (WACS) eastward through Namibia to Botswana and onward to Johannesburg. The TKF also extends northward through Zambia to connect to Dar es Salaam in Tanzania, which made Paratus the first operator to connect the west and east coast of Africa under one Autonomous System Number (ASN).

This means that Paratus is now “exporting” internet capacity to landlocked countries such as Zambia, Botswana, the DRC with more countries to be targeted, and through its extensive African network, Paratus is well-positioned to expand the network even further into emerging ICT territories.

PNH as a fully-listed entity on the NSX, is therefore now the 100% shareholder of Paratus Namibia thereby becoming a public company. PNH is ready to invest in the future of the ICT environment in Namibia. The public is therefore invited and welcome to acquire shares in Paratus Namibia Holdings by speaking to a local stockbroker registered with the NSX. The future is bright, and the opportunities are endless.