SADC you are on your own
In April, the South African economy was downgraded by international rating agencies to junk status. Three months later its neighbour to the north, Namibia, also gets downgraded to junk status.
Namibia’s Finance Minister Calle Schlettwein expressed his dismay at the decision by Moody’s Investor Services to downgrade Namibia’s long-term senior unsecured bond and issuer ratings from Baa3 to Ba1, and maintaining a negative economic outlook for the country.
Moody’s decision was informed by what it said was the fact that Namibia’s increased debt burden, limited institutional capacity to manage shocks and risk of renewed government liquidity pressures in the coming years. It said that Namibia’s public debt burden has risen rapidly over the past several years, from 26 percent of GDP when Moody’s first assigned the rating in 2011 to the current 42 percent of GDP.
Schlettwein was quoted in the media describing the down grade as “highly regrettable” and that the agency “relied on activities that happened four months into the implementation of the 2017/18 fiscal year.” He also said Namibia’s public debt level is within the prescribed threshold for middle income countries.
Either the minister is trying to mislead the public or the rating agency got it completely wrong, or there could be a third option which talks to the rating agencies deliberately using the ratings as a way to reign Namibia in.
Conspiracy theorists already pointed out that the downgrade was to caution the country from implementing policies and laws that are seen as anti-white and could empower the black population. Coincidentally, Namibia is in the process of working on a law that will compel all white owned businesses to sell a portion of their shareholding to previously disadvantaged people, which generally mean black people.
Since being introduced 10 years ago, the Black Economic Empowerment Bill has not been passed into law and has been sent back to the drawing board several times. This time, however, the Namibian government seems to be more interested in passing it into law. The other reason is the upcoming land conference.
A significant number of pressure groups in the country have been calling for the right to their ancestral land. Some are even calling for the constitution to be changed to allow for land expropriation without compensation. It is a fact that the bulk of the land in Namibia is owned by whites who constitute about two percent of the population.
South Africa on the other hand, was downgraded because President Jacob Zuma decided to use his constitutional rights, powers and prerogatives to change his cabinet. Zuma pushed for a policy shift and wanted to implement what his government called Radical Economic Transformation, which is largely aimed at economically uplifting the country’s masses who remain marginalised and excluded from participating in their country’s economy.
Zuma too called for land expropriation without compensation.
It is our firm belief that as African countries, there is nothing we can do to stop those who run the world from bullying us, but we must never be bullied into submission.
We therefore ask SADC governments and the rest of Africa to start looking within for solutions to our problems. Only then can we create our own rules and close rank to ensure that Africans are the first beneficiaries of its resources and prosperity. In the last month our editorials have been urging SADC leaders to start working together and implement economic cooporation treaties they signed.
One editorial was titled ‘A lack of political will remains SADC’s Achilles heel’ and the other was ‘Non but ourselves can create the SADC that we want’.
Both are urging SADC leaders to start closing rank and give each other first priority when it comes to trading, economic development and allowing for the free flow of goods and people.
Without creating our own game for the benefit of our people, we will, forever, be forced to dance to the tune of others and abide by their rules no matter how unfair they are to us.
It is only through creating our own gig that SADC governments and their people will be allowed to freely make significant policy decisions without being bullied or disadvantaged by the likes of Moody’s.