President Geingob rules out dropping currency peg with South African rand

08 Apr 2019 18:20pm
WINDHOEK, 08 APR (NAMPA) – President Hage Geingob has reiterated the Bank of Namibia’s stance that Namibia will not drop its currency peg with the South African Rand.
Geingob during an interview with Bloomberg on Monday said the Namibian Dollar will not be de-linked from the Rand unless something drastic happens.
The president is attending the Horasis Global Meeting in Portugal, where business leaders interact with key government officials and eminent thought leaders. This year, discussions centre around the theme of “Catalysing the benefits of globalisation”.
“We have to consider all the options, but after having considered that we still think that backing one-on-one with the Rand is the best option,” Geingob said.
The Bank of Namibia in December said the peg arrangement remains in the best interest of Namibia as it continues to achieve the primary objective of price stability, through a peg exchange rate regime with the ultimate aim of promoting economic growth and development.
Bank of Namibia Deputy Governor Ebson Uanguta said the bank conducts assessments on the sustainability of the current arrangement from time to time.
He added that the assessments that inform its policy advice to Government concluded that the benefits from the fixed exchange rate arrangement between the two currencies outweigh the costs.
Namibia’s trade structure also shows that about 60 per cent of goods in Namibia are imported from South Africa, and the peg arrangement helps the country to save substantially on transactional costs.