The New Zealand government’s decision to adopt an emissions trading scheme as part of its Kyoto Protocol obligations will add additional cost pressures onto the economy over the coming years. To date, New Zealand has weathered these shocks reasonably well.
I do not intend to spend too much time on this argument for a number of reasons. There is nothing in the CMA arrangement that precludes the Bank of Namibia from undertaking an appropriate lender of last resort function should the need arise. All that is needed is an adjustment in its foreign reserve coverage beyond the current 100% minimum.