In-Depth Analysis
Namibia
The economy is small with an overreliance on certain key exports, namely diamonds, uranium, and fish. Relatively large fiscal deficits since 2009 have caused rapidly rising government external debt levels and slipping credit ratings. Rock-bottom diamond sales and quiet airport lobbies amid the Covid-19 crisis were major blows to the economy in H1 2020.
We now expect a 7.4% contraction this year and a relatively weak recovery of 4.7% in 2021 on the back of the lifting of Covid-19 restrictions and base effects, but constrained by a slow bounce back in services activity. Due to the significantly adverse effects of the Covid-19 crisis on various income streams, we have revised our budget deficit forecast weaker to 11.5% of GDP in 2020. We still expect some moderate fiscal slippages in the medium term given the weak economic recovery, the slow pace of fiscal reforms, wasteful expenditure, volatile customs union revenues, and continued losses at major SOEs. The upcoming local elections will be a key illustration of how much support the ruling Swapo party has lost as a result of recent developments in the Fishrot corruption scandal and the handling of the Covid-19 pandemic. (Source: Namibia Quarterly Update, September 2020)
Macroeconomic Data
(2019)
|
Fiscal Balance (as a % of GDP) |
-5.1 |
|
Consumer Price Index (% change y-o-y, avg) |
3.7 |
|
Current Account Balance (as a % of GDP) |
-2.0 |
|
Real GDP (annual % change) |
-1.0 |
|
GDP per capital, US$ |
4,957.1 |
|
Import Cover (months) |
4.2 |
|
Population, million |
2.5 |
| Total External Debt (as a % of GDP) |
68.3 |