Assessing Investment Climate, Macroeconomics Indicators and Regulatory

Environment

Daniel Motinga Economist

Table of Contents }  Overview of Business Climate }  Doing Business in 2011 – Worldbank }  Namibia Macroeconomics

}  Structure of the Economy }  Price developments and outlook (CPI + interest rates) }  Demand indicators and trends (vehicle sales + housing) }  GDP by sector share }  GDP growth by sector }  Telecoms and ICT in GDP

}  Summary and conclusions

Sustainable Economic Transformation

Inputs

•  Labour •  Capital

Production

•  Company Transformation •  Technology

Income

•  products •  Services •  Payments (salaries, taxes, profits) •  Focus on triple bottom-line (environment, business, society)

Creative Destruction – Schumpeter’s }  Starting a business }  Trying to make it a success }  Failing – it is important }  Shutting down – the business not you! }  Trying again….until successful

}  SWOT Analysis of the Namibian economy

How Easy Is It To Do Business?

Getting started

Dealing with documentation

What it takes to start a business in Namibia?

Some improvements

Has it become easier in relative terms?

Construction permits

Has it become easier in relative terms?

How long does it take to register property?

Has it improved overtime?

How easy is it to get credit?

How easy it to pay taxes?

Has paying taxes become easier overtime?

Tax rate is quite competitive

How easy is it trade across borders?

Has it improved overtime?

How easy is it to enforce contracts?

How easy is it complete insolvency process?

What are the pillars of competitiveness?

Variables that inform stages of developments

At what stage is Namibia?

Namibia Global Competitiveness

Global competitiveness (cont’d)

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Namibia Ranking and dimensions

Problematic factors for doing business

MACROECONOMICS

Structure of the Economy - Production 1980 1990 2000 2011

Primary sector 59% 24% 21% 17%

Secondary sector

15% 14% 16% 18%

Services (incl. govt)

39% 54% 56% 57%

Structure of the Economy - Demand

58.5% 21.0%

20.2%

0.2%

Demand structure

Private consumption General government Investment Change in inventories

Namibia growth outlook

3.4%

-1.1%

6.6%

4.5%

4.0%

3.5%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

2008

2009

2010

2011

2012

2013

Trends in credit demand

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12

Individuals Business Total

Namibia and SA Inflation

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00% 01

/200

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02/2

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Nam inflation SA inflation

Namibia interest and inflation rates

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

policy rate (Nam) Inflation rate (risk)

Trends in new vehicle sales

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

0

200

400

600

800

1000

1200

1400

1600

Jan-99 Jul-00 Jan-02 Jul-03 Jan-05 Jul-06 Jan-08 Jul-09 Jan-11

New vehicle sales NV Y-o-Y change (%)

Structure of the Economy - Production 1980 1990 2000 2011

Primary sector 59% 24% 21% 17%

Secondary sector 15% 14% 16% 18%

Services (incl. govt) 39% 54% 56% 57%

Post and telecommunications 1.4% 1.5% 2.4% 2.8%

}  The End