NAMFISA prides itself with this omnibus legislation, as representing global best practices. It has put a lot of energy into this legislation, and understandably, it refuses to move off its fixed standpoint, believing that global best practices are all that is required.

But are global best practices necessarily appropriate for Namibia? Has NAMFISA ever tried to question its position and establish if the new legislation's cost is economically justifiable? For all bigger infrastructure projects, an environmental impact assessment has to be carried out before the government can proceed. This new legislation is a massive project that has never been subject to an environmental assessment study, and we have no clue about its impact on the economy.

The man in the street whose investments are to be protected through the FIMA is not financially sophisticated enough to understand what a cost factor of 1% per year of their investment value over 30 or 40 years would mean for their retirement wellness. They rely on someone unknown to ascertain that their interests will not suffer. NAMFISA believes it is responsible for protecting his interests – and relies on global best practices. However, its is not accountable to the man in the street. Being responsible but not accountable has never been a good recipe. The Minister of Finance is responsible to the president, who is answerable to the electorate. However, as the NAMFISA CEO acknowledged, “FIMA is quite technical, and as a technical act, not everybody understands financial matters, and even our financial literacy in Namibia is quite low...”. He is quite correct and it is too technical for those accountable to the electorate.

Simply resting on the global best practice laurels is not sufficient. The parliament needs a different model for evaluating such complex and technical laws. In a previous newsletter, I proposed a model for the parliament to apply to such technical laws.

We have appropriate experts in Namibia who can advise, and it is crucial to rely on local industry experts instead of foreigners because they must implement the new laws. If the new law is beyond their capabilities, the government must expect to face endless problems in the future. Although local experts were allowed to provide their input, most critical issues dealing with the principles were ignored for not being global best practice.

As often expressed by NAMFISA, it suspects the industry of having an agenda of making as much money as it can at the cost of the consumer. For that reason, NAMFISA is always suspicious of advice from industry experts and instead relies on foreign experts (who, of course, never have an agenda except perhaps to establish a never-ending dependency between them and their Namibia clients.)

I acknowledge that local industry experts do and should have a business motive. That does not mean that the business motive is short-term and unsustainable. On the contrary, the motivation of a prospect of gain drives human activity. To manage the risk of the profit motive killing the man in the street, we only need to ensure competitive market conditions and proper risk management at the top level!

It seems that dependencies on foreign agents are forced upon Namibia (as referred to in the following article on new cross-border payment rules), or we subject ourselves to ‘benevolent’ foreign agents voluntarily because we do not trust our local experts!

Important notice and disclaimer
This article summarises the understanding, observation and notes of the author and lays no claim on accuracy, correctness or completeness. RFS (Pty) Ltd does not accept any liability for the content of this contribution and no decision should be taken on the basis of the information contained herein before having confirmed the detail with the relevant party. Any views expressed herein are those of the author and not necessarily those of RFS.

.