By Hilary Mare
THE drafting of the legislative framework governing the non-banking financial sector has now been finalised, Finance Minister, Calle Schlettwein, has revealed.
Addressing delegates at the Retirement Funds Institute of Namibia (RFIN) annual conference held in Swakopmund last week, Schlettwein said the drafting of an amendment to the Namibia Financial Institutions Supervisory Authority (Namfisa) Act, as well as the Financial Institutions and Markets Bill, had been finalised and that they would be tabled in parliament soon.
The related Financial Services Adjudicator Bill and the Microlending Bill had also been successfully drafted, and will also be heading to parliament.
“I intend tabling these Bills during the current session of parliament, after an elaborate consultation and drafting processes. Apart from the modernisation of the laws, in line with international and market developments, the regulatory focus is on risk-based supervision, to ensure that risks are mitigated in favour of financial stability,” Schlettwein said.
In anticipation of the implementation of the revamped legislative framework and attendant regulations, Namfisa has undertaken consultation with industry players, to review the fees and levies which finance the cost of supervision, as they were last reviewed in 2003.
Commenting on this, Schlettwein noted that he had considered the proposals made, and directed that significant increases in the proposed levies be guarded against.
He said that the levy rates should be approached in accordance with the cross-subsidisation principle, and in line with regional benchmarks.
The finance minister said further that changes to regulations dealing with domestic asset requirements, in order to lift the domestic asset thresholds from 35 to 45 percent over time, are now with the legal drafters and are expected to be gazetted by the end of the month.
The threshold is set to be raised to 40 percent by January 2018, to 42.5 percent by April 2018 and 45 percent by October 2018.
“The policy intention is for Namibia, as a developmental State, to effectively mobilise domestic resources to fund socio-economic development needs and investment opportunities. Namibia has over the years been experiencing a perpetual savings-investment gap, jobless growth, high unemployment and poverty rates, as well as high-income inequality, which is the second highest in the world.
“I have referred to the envisaged establishment of a ring-fenced infrastructure fund as one such investment opportunity. Government I also working on proposals for the partial listing of some of its public enterprises, while also looking at how best to leverage existing public assets to raise capital and crowd-in private sector participation,” Schlettwein said.
Namibia is undertaking a Financial Sector Assessment Program this year, in collaboration with International Monetary Fund (IMF) and World Bank Group, to identify financial system areas, which need strengthening.
In further elaboration of the strides that government has made, the Schlettwein noted the Public-Private Partnership (PPP) Act, which came into force this year, provides a regulatory framework for public-private partnerships, as a conduit for private capital co-investment.
“We envisage projects with an underlying revenue base, in the energy, rail, water and service sectors, to benefit from PPP formations, with greater domestic investor participation. The PPP legislation has thus opened up opportunities for the retirement industry and other institutional investors to leverage on the investment opportunities,” he said.
The Public Procurement Act, which has been in force since April this year, also contains specific local preference provisions.
“I call on the retirement fund industry to give effect to the provisions of this law and realise the multiplier benefits of local procurement in the economy. Last, but not least, the Financial Inclusion Council has approved the SME Financing Strategy, which intends to increasingly meet the financing needs of SMEs, in the form a Venture Capital Fund, the Credit Guarantee Scheme and the Training and Mentorship Program. The proposals are now being considered by Cabinet,” Schlettwein added.
Confidente. Lifting the Lid. Copyright © 2015