Namibia has revised its 2025 economic growth forecast downward to 3.3%, from the 4.5% estimate announced in March, citing a sharp slowdown in manufacturing activity, Finance Minister Ericah Shafudah said on Tuesday.
Presenting the mid-year budget review, Shafudah explained that the manufacturing sector has been under pressure due to reduced diamond processing, as well as lower cement and blister copper production.
While manufacturing struggles, the outlook for the primary sector remains positive, with growth projected at 2.5% this year—up from 1.8% in 2024—driven by increased mining of uranium and other minerals.
Namibia’s average growth over the next three fiscal years is now expected to be 3.6%, down from 4.3% in the earlier forecast.
Shafudah also warned of deteriorating public finances, noting that the budget deficit widened to 4.0% of GDP in the last fiscal year, compared to 2.0% the year before.
“If left unattended, this worsening trend is highly undesirable and will lead to serious deterioration of key fiscal anchors such as the debt-to-GDP ratio,” she cautioned.
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In a related move, the Bank of Namibia last week cut its main lending rate by 25 basis points to 6.50% in an effort to stimulate the slowing economy.
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Source:Africa Publicity
