Central bank committed to maintaining price stability

Bank of Namibia governor, Johannes !Gawaxab says the central bank is committed to maintaining price stability and fostering sustainable economic growth.

He said this after the bank hosted a monetary policy strategy session to bolster the understanding and implementation of monetary policy within the country.

The session was held on Monday and saw representation from industry experts and other central banks.

“As we navigate the complexities of steering our nation’s monetary policy amid a myriad of challenges, it is imperative to acknowledge the significance of our roles in guiding the economic trajectory of our open, small economy,” !Gawaxab said.

He said the bank is taking this deliberate step due to resurfacing inflationary pressures, and the emergence of disruptive technologies such as artificial intelligence (AI).

“We are committed to leveraging our collective expertise and insights to ensure our monetary policy remains adaptive and responsive to the evolving global landscape, thereby fostering macroeconomic stability and driving sustainable economic growth for the prosperity of all Namibians,” !Gawaxab said.

The session offered insights from central banks like the South African Reserve Bank (SARB) and the Bank of Botswana, as well as international experts.

Chris Loewald, the head of economic research at the SARB, shared valuable knowledge on South Africa’s monetary policy process, offering an understanding of the complexities involved in managing inflation and fostering economic stability.

Ricardo Hausmann, the founder and director of Harvard’s Growth Lab, spoke on the international experiences surrounding currency pegs, cautioning against their potential dangers and stressing the importance of sound monetary principles.

Hausman said perils are associated with unsustainable currency pegs, citing the printing of money as a primary catalyst for economic turmoil.

Additionally, !Gawaxab reiterated the bank’s stance on the current exchange rate regime, stating that the benefits of the Namibia dollar’s one-to-one link with the South African rand outweigh the costs.

!Gawaxab assured that the Bank of Namibia would continue to safeguard this relationship.

Kealeboga Masalila, the deputy governor of the Bank of Botswana, highlighted the importance of transparency and communication in shaping policy decisions.

The session sparked engaging discussions on Namibia’s past, present and future monetary policy.

Participants debated challenges and opportunities, aiming to enhance the efficacy of policy instruments and frameworks.