Bank of Namibia (BoN) Governor Johannes Gawaxab has been lowly rated after he scored a D+ in a survey conducted by Global Finance magazine of Central Bank Governors in 2021.
The magazine described Gawaxab as cautious when it comes to his handling of the country’s monetary policy and was not ranked the previous year, noting it was too early to say on his performance since he assumed the reins in June 2020.
The magazine, however, noted the intervention measures taken by the central bank to guard the domestic economy against the negative impact of COVID-19 under his watch.
“More than a year after he took over as governor, Gawaxab continues to adopt a cautious approach in monetary policy. In August, the Bank of Namibia (BON) kept the repo rate unchanged at 3.75% terming it appropriate in supporting the weak domestic economy and safeguarding the one-to-one link between the Namibia Dollar and the South African Rand. For Namibia, Covid-19 has had extensive advance impacts, prompting the central bank to warn against in June when the country experienced a third wave of infections. Key sectors of the economy like tourism, mining, agriculture, manufacturing and construction have been badly ravaged. The ripple effects have been significant decline in banking industry profits and surge in NPLs. Concerns over the stability of the industry have forced BON to heightened credit risk monitoring and carry out stress tests. The weak economy has forced BON to revise its economic growth projections to 1.4% from an earlier forecast of 2.7%,” the magazine said in its review of the central bank’s action during the period under review.
BoN in response to the ranking said it welcomed the scrutiny that comes with its mandate of presiding over the country’s monetary and financial stability.
“It is common course that Namibia’s macroeconomic stability has been tested during the past two years since the advent of the Covid-19 pandemic and has emerged resilient thanks to the measures undertaken by key stakeholders, including the Bank of Namibia. Our inflation and policy rates are at historic lows, and we continue to support individual households and businesses to weather the pandemic-induced storm. We have a stable, modern, and sound financial system despite serious challenges introduced by COVID-19. We continue to work closely with other authorities to ensure economic recovery and sustainable economic development going forward. We are proud of the collective work to steer the ship during these trying times,” BoN Spokesperson, Kazembire Zemburuka said.
The global magazine, with input from analysts, economists and financial editors, each year grades the world’s leading central bankers on a scale of A to F, based on a series of objective and subjective metrics, including the appropriate implementation of monetary policy.
Meanwhile, Reserve Bank of Zimbabwe (RBZ) Governor John Mangudya has been classified among the worst central bank governors, according to the magazine ranking, a sharp contrast to South Africa’s Lesetja Kganyago who has a top ranking and has been described as a “bold” central banker in responding to the economic shocks that have characterised South Africa’s economy.
