The Governor of the Bank of Namibia, Johannes !Gawaxab, says the persistently high cost of living is a cause for concern that puts ordinary Namibians under pressure.
!Gawaxab advised that central banks combat inflation that disproportionately affects vulnerable members of society.
The Bank of Namibia recently hosted the central bank Governors of the Common Monetary Area, South Africa, Lesotho, and Eswatini.
The meeting was aimed at assessing the state of the economies and the progress made thus far on the implementation of the Common Monetary Area strategy.
!Gawaxab raised concern about the impact of inflation on ordinary citizens, calling on fellow governors to put measures in place to manage inflation.
"Any alternative reserve currency needs to satisfy the criteria around convertibility, liquidity, rule of law, and deep capital markets. The fact that the oil is priced in USD is another key consideration in this debate. We are following the debate around alternative currencies, knowing that a lot of water will have to flow into the ocean before the status quo changes. The transition to a new reserve currency, if it happens, is a slow process, much like a snail's race."
The Governors also deliberated on the African currency.
"Another debate that ranges around currencies is about an African currency. To achieve this, we know that macroeconomic convergence is a prerequisite. To achieve this noble objective, we need similarities in inflation, debt levels, fiscal policies, and banking rules, to mention but a few."
The meeting also discussed the impact of the recent weakness of the Rand among CMA countries, with spillover effects being felt particularly by smaller countries that rely on imports.
"Governors, the weakness of the Rand in most recent times has led to intense debates in countries participating in the CMA. The spillover effects have been acute, as most of our smaller countries are net importers of goods and services. We shouldn't shy away from pointing this out and reflecting on mitigating strategies in light of the direct but varied impact in each of our countries."
In this regard, !Gawaxab said it was essential to address these concerns openly and explore strategies to mitigate the varied impacts experienced by each member.
Progress on various initiatives of the CMA projects, such as Central Bank Digital Currencies, Deposit Insurance Schemes, Cross-Border Payments, Exchange Control, and Financial Stability, were also discussed.