Namibia’s economic growth to recover to 3.1 per cent

WINDHOEK, 26 FEB (NAMPA) – Namibia’s economic growth is projected to recover to 3.1 per cent in 2026 after being revised downward to 2.9 per cent in 2025, Minister of Finance, Ericah Shafudah, said on Thursday.
Tabling the 2026/27 national budget in the National Assembly, Shafudah said the 2025 growth figure is lower than both the 3.3 per cent estimated in the mid-year budget review and the 3.7 per cent recorded in 2024.
She said the 2025 performance was mainly driven by uranium and gold mining, as well as wholesale and retail trade, transport and storage.
The minister said domestic economic growth is projected to recover to 3.1 per cent in 2026, while medium-term growth is expected to average around 3.3 per cent.
Annual inflation declined to 2.9 per cent in January 2026 from 3.2 per cent recorded in January 2025, driven by easing food prices, although housing and utility costs remain elevated. Inflation is expected to average about 3.5 per cent in 2026, supported by lower global oil and food prices.
Meanwhile, the country’s international reserves declined to N.dollars 51.6 billion at the end of December 2025 from N.dollars 63.0 billion in December 2024.
The decrease was mainly attributed to foreign debt repayments, including the Eurobond redemption, lower SACU receipts and net capital outflows, compounded by the strengthening of the Namibia dollar against major currencies, Shafudah said.
The minister said the Bank of Namibia reduced the repo rate by 50 basis points to 6.50 per cent in 2025 to support the economy and maintain the currency peg with the South African rand. The policy rate was left unchanged in February 2026.
In addition, the central bank directed a 25-basis-point reduction in commercial banks’ lending rates by December 2025, narrowing the prime-repo spread to 3.50 per cent and generating annual savings of at least N.dollars 314 million for borrowers.
On the global outlook, Shafudah said world economic growth is projected at 3.3 per cent in both 2025 and 2026, before moderating slightly to 3.2 per cent in 2027, amid continued uncertainty.
(NAMPA)
AT/HP/AS