WINDHOEK, (Xinhua) -- The controversial bill cited by Fitch as one of the reasons the rating agency downgraded Namibia’s economic outlook will be carefully implemented to retain investor confidence, Prime Minister Saara Kuungogelwa-Amadhila said Wednesday in Windhoek.
Namibia is currently in the process of consulting on the New Equitable Economic Empowerment Framework that will, if adopted and passed, see companies reserving 25 percent shares to previously disadvantaged people.
The law will also make it mandatory for companies to have at least 50 percent of Namibians as management and board members.
According to the proposed law, at least 1.5 percent of gross earnings should be spent on skills development and training.
It also says a minimum of one percent of after-tax profits should be earmarked for community projects.
In its report released Friday last week, Fitch said while the bill lacks details, it is likely to be approved by parliament and this has caused some unease in the business community and could slow down foreign investment in manufacturing and services.
Kuungogelwa-Amadhila, however, said the bill has been subjected to extensive public consultations with stakeholders whose views will be considered.
“Further, the bill will take into consideration the constitutional provisions and take into account the critical need to safeguard the economic gains made so far,” she said.
She also said such implementation will seek to maintain Namibia’s hard earned investor confidence to build on the foundation of a stable and growing economy.
Kuungogelwa-Amadhila said the bill seeks to address some of the factors such as high inequality, high unemployment and low per capita growth.
“A carefully crafted empowerment law that effectively target these issues can help unleash the potential of the economy to achieve higher and more equitable growth and develop resilience to external shocks,” she further said.
Furthermore, Kuungogelwa-Amadhila said the implementation of the law once passed, will consider the peculiarities of different sectors and provide for sector specific implementation strategies and targets.
The prime minister also said the regulations will provide for thresholds for applicability of the provision of the law such that certain specific businesses may be exempted from some provisions of the law.
In fact, she explained, the government is committed to ensuring that the proposed law supports its policy objectives of promoting investment and economic growth.
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