EXCLUSIVE INTERVIEW: Navigating Namibia’s Gray Listing: Insights from Independent Business and Economics Researcher Josef Kefas Sheehama

In a recent conversation with independent business and economics researcher Josef Kefas Sheehama, the focus turned to Namibia’s gray listing by the Financial Action Task Force on the 23rd of February. Despite the challenges posed by this development, Sheehama emphasizes that being on the gray list is not a death sentence for Namibia’s economy. In this article, we delve into Sheehama’s insights on the impact of the gray listing and the potential pathways for Namibia to overcome this challenge.

Understanding the Reputational Risk:

Sheehama acknowledges that the gray listing puts Namibia at reputational risk. The country’s failure to effectively combat financial crimes such as corruption and money laundering has led to a perception that it falls below international standards. This, he notes, can result in a decline in GDP and foreign direct investment (FDI), as evidenced by statistics from the International Monetary Fund (IMF).

Economic Consequences and Challenges:

The conversation with Sheehama sheds light on potential economic consequences, including a projected decline in GDP and FDI. He highlights that compliance challenges may arise, affecting export and import payments, especially with regard to letters of credit. The increased scrutiny and due diligence requirements may impact Namibia’s foreign exchange control and raise costs for businesses, particularly those involved in cross-border transactions.

Room for Improvement:

Despite the challenges, Sheehama emphasizes that there is room for Namibia to rectify the situation. He points out that being on the gray list necessitates compliance with international standards, which can ultimately boost confidence in the nation’s economy. While acknowledging the need for diligence and cooperation, he believes that Namibia can successfully navigate its way out of the gray list.

Positive Outcomes and Reforms:

Sheehama discusses the positive aspects of being on the gray list, highlighting that it compels Namibia to comply with international standards. He anticipates that as the country implements necessary reforms and demonstrates commitment to combating financial crimes, foreign direct investment will flow in, contributing to economic growth.

Collaboration for Success:

Sheehama emphasizes the importance of collaboration among various stakeholders, including policymakers, legal experts, financial institutions, and the government. He acknowledges that proactive efforts to address the deficiencies outlined by the FATF are crucial for removing Namibia from the gray list.

In conclusion, while Namibia faces challenges as a result of its gray listing, Josef Kefas Sheehama provides a nuanced perspective on the situation. By focusing on compliance, reform, and collaborative efforts, he believes that Namibia can successfully navigate these challenges, demonstrating resilience and a commitment to international standards in the realm of finance and economics.