Government to remove bottlenecks

Windhoek – Government will remove bottlenecks which have previously hampered the smooth execution of capital projects announced in the 2011/12 national budget, Finance Minister Saara Kuugongelwa-Amadhila said. Rebutting economists’ rather harsher critique of the government’s expenditure plan for 2011/12 outlined in the national budget, Kuugongelwa-Amadhila said that the budget will provide the tonic for growth. The finance minister however admitted that government has previously faced challenges with implementation of some of its capital projects. Kuugongelwa-Amadhila told The Southern Times that ministries and government agencies often lag behind when it comes to execution of budgeted for capital projects. Implementation of capital projects, which are expected to generate the much needed employment has somewhat improved to between 80 and 85 percent. The finance ministry announced that it will finance 646 capital projects, of which 484 are on-going projects in a concerted effort to create jobs and stimulate growth. “We are carrying out reforms to address problems that have previously affected budget implementation rate. On other government projects, implementation rate is now around 95 percent but with capital projects it is between 80 and 85 percent. But then it should be possible to address those bottlenecks. We will address the problem areas,” Kuugongelwa-Amadhila asserted. She also admitted that while focus is to plug the unemployment gap, some jobs particularly in infrastructure projects, might not be sustainable in the long term. “There are jobs which will be created in the medium term, that is during this current budget and there will be jobs which will not be sustainable. Investment in agriculture for instance negates the argument that jobs would not be sustainable,” Kuugongelwa-Amadhila said. She said that government’s thrust is to open up infrastructural projects, such as road networks, ports and rail links which can be utilised not only by Namibia but the rest of the SADC market. “I don’t understand why some people are now saying that government will crowd out the private sector, we are trying to develop the capacity of Namibia as a whole and the private sector is part and parcel of that process, there won’t be any crowding out,” Kuugongelwa-Amadhila said. The finance ministry has come under heavy criticism from economists and the private sector who questions government’s ability to deliver on its jobs plan. Analysts have also raised fears on government’s ballooned expenditure, widening deficit and rising government debt stock.  Budget deficit will widen to 9.3 percent in 2011 from 7 percent in 2010 but will narrow down to 5.2 percent of gross domestic product by 2012. Government debt will rise by 27.4 percent of GPD in 2011, 30.3 percent in 2012 and 33.9 percent in 2013, a development which analysts have argued will likely stymie growth in the long run.

April 2011
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