1. ArR720S: applied regional and RURAL economic development
Financial instruments and tools in regional and rural economic development
ArR720S: applied regional and RURAL economic development

2. outline Weaknesses in financial sector
Namibia’s Financial Sector Strategy: purpose, vision, reform areas and strategies

3. objectives
To examine the instruments and tools contained in Namibia’s Financial Sector Strategy
To engage students and assess their understanding through interactive discussions

4. Introduction: Namibia’s economic performance
Satisfactory and sustained growth rate: average of 3%
Financial stability during 2007 global financial crisis
Structural weaknesses in financial sector and need for Namibia Financial Sector Strategy

5. existing weaknesses in financial sector
Shallow financial markets
Limited competition
Poor financial safety nets
Underdeveloped capital markets
Poor regulation

6. existing weaknesses in financial sector (cont’d)
Limited access to financial services
Low financial literacy
Poor consumer protection and activism
Limited skills
Low citizen participation

7. Namibia financial sector strategy (NFSS)
Spans the period
Background: a response to address structural weaknesses in financial sector
Purpose/rationale/objective: to guide the future of the financial system in order to ensure its effectiveness, competitiveness and resilience
A sector development strategy towards realising Vision 2030

8. Nfss vision: 2021
Deepened, efficient and well-developed financial system
Reliable and effective financial regulatory system
Competitive financial sector
Local ownership of financial institutions
Inclusive financial strategy
Financial literacy and consumer protection

9. Unpacking nfss vision: 2021
Vision 2030: Namibian economy expected to grow by 6.2% per annum
Projected growth of financial sector: 6.3%
Efficiency: wide range of financial products at low cost
Effectiveness: innovation, product differentiation, customer-centric orientation
Stability: prudential regulations, robust financial institutions, infrastructure

10. Current status of Namibia's financial system
Commercial banks
Other specialised financial institutions
Non-bank financial institutions: insurance, pension funds, investment managers, unit trusts, microfinance institutions, stock exchange and stockbrokers

11. NFSS focus: reform areas
Deepening and developing financial markets
Providing financial safety nets
Financial inclusion
Localisation of financial sector
Skills development

12. Deepening and developing financial markets: strategies
Cost-benefit analysis
New instruments: exchange traded funds, securities and derivatives
Corporate papers
Public-private partnerships
Stock exchange
Enabling regulatory environment

13. Providing financial safety nets: strategy
Appropriate deposit insurance and resolution scheme for Namibia

14. Financial inclusion: consumer protection strategies
Market conduct principles and oversight
Establishment of financial services complaints adjudicator
Consumer education

15. Financial inclusion: financial literacy strategies
Clear policy framework
National baseline data
Financial and consumer education
Monitoring and evaluation

16. Financial inclusion: Access to financial services strategies
Survey: FinScope 2011
Credit Agreements Act
Review of usury rate thresholds
Regulation on electronic money
Action plans: National Payment System Vision 2015

17. Financial inclusion: Access to financial services’ strategies (cont’d)
Improved financial access
Amendment of Banking Institutions Act
National venture capital fund
Micro-insurance products
Balance between financial integrity and access

18. Financial inclusion: institutional support strategies
Revision of 1997 SME Development Policy
Credit Guarantee Scheme
Credit bureau
Specialised SME bank
Coordination of existing initiatives
SME advisory services
Mandate review: NAMPOST Bank

19. Localisation of financial sector: strategies
Issuing appropriate level of Namibian ownership of financial institutions
Monitoring implementation of various initiatives

20. Skills development: strategies
Financial Sector Skills Enrichment Programme
Review of courses at tertiary institutions
Strengthening of professional institutions
Short-term measure: employing foreign workers with critical skills

21. Discussion questions
Assess the background and existing weaknesses in the financial sector which necessitated the birthing of Namibia’s Financial Sector Strategy (NFSS).
What is the purpose and vision of the NFSS document?
Discuss the current status of Namibia’s financial system.
What are the five main reform areas associated with the NFSS?
Examine the strategies for attaining the five main reform areas under NFSS.

22. Open debate and discussion
The reform of Namibia’s financial sector is the primary responsibility of the government, rather than the private sector.

23. review Sub-themes Details Namibia’s economic performance
Satisfactory and sustained growth rate: average of 3%
Financial stability during 2007 global financial crisis
Structural weaknesses in financial sector and need for NFSS
Existing weaknesses in financial sector
Shallow financial markets; limited competition; poor financial safety nets; underdeveloped capital markets; poor regulation; limited access to financial services; low financial literacy; poor consumer protection and activism; limited skills; low citizen participation
Namibia Financial Service Strategy (NFSS)
Spans the period
Background: a response to address structural weaknesses in financial sector
Purpose/rationale/objective: to guide the future of the financial system in order to ensure its effectiveness, competitiveness and resilience
A sector development strategy towards realising Vision 2030
NFSS Vision: 2021
Deepened, efficient and well-developed financial system
Reliable and effective financial regulatory system
Competitive financial sector
Local ownership of financial institutions
Inclusive financial strategy
Financial literacy and consumer protection
Current status of Namibia’s financial system
Commercial banks
Other specialised financial institutions
Non-bank financial institutions
NFSS focus: reform areas
Deepening and developing financial markets
Providing financial safety nets
Financial inclusion
Localisation of financial sector
Skills development

24. reference
Republic of Namibia: Ministry of Finance. (n. d.). Namibia Financial Sector Strategy, , towards achieving Vision 2030.