Guest Contributor | Feb 21, 2024 | 0
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.”