‘Stop trivialising Covid-19’

Commercial banks in Namibia have repossessed houses worth N$230 million in the first six months of 2021, as Covid-19 continues to threaten job security.

Releasing the data during a public lecture at Keetmanshoop last week, Bank of Namibia (BoN) governor, Johannes !Gawaxab, said between 2017 and 2019 the value of houses repossessed by banks in the same period averaged N$100 million.

“People lost their jobs and could not honour their obligation with the banks due to Covid-19, people lost income due to the lockdowns. It is not only in Namibia this is happening, but all over the world, if you are seeing this as a Namibian problem then one is missing the point,” stressed !Gawaxab.

Vehicle repossession in 2020 dropped to N$15 million, but increased to N$21 million in the first six months of this year.

!Gawaxab said out of 1 700 business closures recorded in the last three years, 40% were in 2019, 33% in 2020 and 27% recorded during the first nine months in 2021.

He added that closures were mainly observed in sectors such as tourism, construction, wholesale and retail trade, real estate as well as other business services including tour operators, consultancies, bookkeeping, clearing agents.

“Economic scarring from the past recessions and the impact of the pandemic largely led to the closures,” he said.

JOB LOSSES

!Gawaxab further said as from 1 January to 31 December 2020, a total of 12 238 employees were retrenched by 896 employers, of which 9 396 employees were retrenched due to economic reasons or closure and business discontinuations, while 2 842 employees were retrenched due to Covid-19 related reasons.

Between January and June 2021, 1 444 employees were retrenched by 190 employers, of which 1 377 were retrenched due to economic reasons or closure and business discontinuations, while 67 employees were retrenched due to Covid-19 related reasons.

While the setbacks are evident at both individual and national levels, the pandemic has provided an opportunity to reset and rebuild the economy on sound fundamentals, according to !Gawaxab.

For this reason, the central bank has continued to support the economy through interventions implemented since April 2020 which have softened the blow on the economy and provided much needed relief to struggling borrowers.

The unprecedented relaxation of certain regulations by the BoN as the regulator of commercial banks has made it possible for banks to lend to critical sectors in the economy while also providing borrowers an opportunity to negotiate repayment conditions on their loans. These relief measures coupled with a low interest environment and low inflation continue to support growth in the economy,” !Gawaxab maintained.

PANDEMIC

“Building on its strong points, Namibia can emerge from the constraints posed by Covid-19, and addressing its challenges with urgency and resolve, a return to vibrant growth is in sight,” he said.

There are several promising projects and initiatives to reinvigorate growth, also in the South, on the horizon, the governor said.

“Continuous reforms and better macroeconomic management coupled with investments and adapting to a changing landscape are inevitable and crucial to secure a recovery going forward,” he continued.

!Gawaxab said trivialising Covid-19 and vaccine hesitancy can be disastrous as the country is not out of the woods yet. Stepping up of vaccination is a crucial element of reviving the economy which needs to enjoy the support of everyone, he concluded. – Own report and Nampa