We are so used to the fact that our economy mirrors the South African economy albeit on a much smaller scale, that we fail to see two very significant factors that have come to the fore over the last year. Firstly, our inflation was gradually moving away from SA inflation, very slowly but still after about a year, there is a marked difference. Against the norm, our inflation is actually less than in SA, indicating obviously that local price pressures are less but also that a typical consumer basket in Namibia is starting to have a different constitution than the SA one. Secondly, for the first time in many years, our bank rate did not match the SA repo rate.

To me, this indicates a measure of maturity that has developed at the Bank of Namibia as well as growing dissimilarities between our economy and theirs. I regard both as positive factors in our local economy.
Dissection the governor's MPC statement, I noticed that of late, the Bank of Namibia issues its own, entirely independent monetary policy statement, and that does this job well. Whereas in the past, we used to copy-cat the Reserve Bank statement, basically falling back on an overview of South African economic conditions, the Bank of Namibia statement has grown into a reputable document, indicative of intellectual as well as analytical depth. I suspect the calibre and content of the Bank of Namibia MPC statements reflect the maturity and increased depth that I perceive in this institution.
I know that there has always been considerable contact between the SA Reserve Bank and the Bank of Namibia. This has been the case for the better part of the Bank of Namibia's existence. So when I now compare the two banks' MPC statements and I see that ours has grown to the level where it reflects an insight into economic conditions previously not displayed, I assume those who determine our financial destiny has also grown in confidence and in ability. Again, this is a very positive message for us.
At the beginning of December last year, I was quite astonished to notice the bank rate was kept unchanged while the repo rate was increased by half a percentage point to 11%. This created a precedent which I assume we shall see with more regular recurrence in future. In this I also sense that the Namibian economy has gradually developed into its own and that our local policy makers are taking the ensuing difference into account more and more, as they determine the direction we need to go.