World Bank fails to reclassify Namibia… as telecoms and education come under spotlight

The World Bank has once again failed to reclassifying Namibia’s economic status into a lower middle-income economy, after it recently updated its country classification by income level for 2022-2023.

Although the World Bank reclassified Namibia as an upper middle-income country in 2009, with per capita incomes reaching a peak of US$6,370 in 2015, the country over the years called for a reclassification amid concerns the current classification was inaccurate.  

President Hage Geingob has consistently warned that the current classification has serious implications on Namibia’s access to affordable debt financing and grants, impacting its ability to address poverty, inequality. 

However, Marie Francoise Marie-Nelly, World Bank Country Director for Namibia, said Namibia should be grateful for being classified as a middle-income country. 

 “To be considered a middle-income country is the fact you have done something well, a lot of people in low-income countries would love to be in that position, meaning in the first 20 years of independence you invested and as a result of that, the GDP moved all the way up, that is a good thing,” she told The Brief. 

 “You have a number of middle-income countries that are poor, and even advanced countries that are poor, and this is the problem because as equality has increased in a number of countries, middle-income countries have shrunk. So it is not because Namibia is a middle-income country that you lack resources; rather, you have access to World Bank resources through various means.”

 “Namibia has sufficient access to resources as recently the World Bank mobilised grants with no interest of US$33.5 million for highly concessional resources from the Green Climate Fund (GCF) and US$15 million from the Global Public Good Fund (GPG) to support investments in Namibia’s renewable energy agenda.”. 

The Country Director said Namibia needs to refocus its energy on dealing with issues such as high telecommunications levies and education quality. 

“Namibia’s good experience is being able to tap into the good experiences of other middle-income countries and address critical issues, and competitiveness is what the country needs, for example, the country’s telecommunications market is overly concentrated, you have two operators who make a lot of money and are under no pressure to reduce levies,” she said. 

“If they had a bit more pressure, they would reduce their prices and I’m glad I have observed that the regulator has started to tackle that. These are the types of issues that need to be addressed, how the youth can access quality education without having to pay and that is why the levies are so high.” 

On education Marie-Nelly said,”It’s not an issue of middle income or not , the government is putting a lot of money into education. You are not getting the returns that are needed because the quality is not there. if the teachers are there or not. The country needs to tackle the right issues.” 

The World Bank’s concerns over the quality of the country’s education system comes as President Hage Geingob last month called for its transformation with a bias towards a more sustainable and inclusive industrialisation drive.

 While Namibia is generally regarded as an upper middle-income nation, the country’s GDP growth has declined steadily and the economy fell into recession, exposing the vulnerability of Namibia’s economic growth model to external and climate shocks.

 In 2019, the economy contracted 0.9% and, in 2020, contracted further by 8.5% because of external shocks arising from commodity demand and price volatilities and from drought, as well as increasing debt that limited public investment.

 This comes as Namibia’s gross domestic product (GDP) growth slowly recovered by 0.8 percent in 2021 and is expected to average just above 2% over 2022–24, premised on waning effects of the pandemic and strong prospects for the mining sector.

 

 

 

 

 

 

editor

See Full Bio