THE African Development Bank (AfDB) has approved a N$1.5 billion loan that will enable the Namibian Government to finance the Governance and Economic Recovery Support Programme (GERSP).
According to a statement issued by Ipumbu Shiimi, the Minister of Finance, the government is pursuing reforms in a wide range of areas for the post-pandemic era.
“The proposed GERSP operation is designed to support the Government’s response and help to achieve inclusive post-pandemic economic recovery through improved governance and real sector reforms,” Shiimi said in the statement.
According to Shiimi, the three main areas of focus for the GERSP will be fiscal sustainability, private sector led agricultural and industrial transformation, and economic and social inclusion.
“The GERSP will create fiscal space to finance critical development spending, implement reforms that will help to maintain macroeconomic stability, transform key sectors such as agriculture and industry, and improve economic and social inclusion,” Shiimi said.
To obtain the loan, the Namibian Government approached the AfDB for financial support through the COVID-19 Rapid Response Facility to address the impact of the pandemic and help maintain Government welfare programs.
According to Shiimi, the request was unanimously approved by the AfDB board of Directors on 17 March 2021 as a loan to finance the GERSP.
He said that the approval of the loan follows the completion of the Economic Governance and Competitive Support Programme that ran from 2017 to 2020.
The plan achieved significant results in the areas of fiscal consolidation, public financial management, and improvement in the business environment.
“The approval of the loan comes at an opportune time as we start the process of building back the economy and implanting the second Harambee Prosperity Plan with the aim to achieve sustainable and inclusive transformation,” Shiimi said.
The finance minister indicated that the N$1.5 billion loan is payable for a period of 15 years.