Windhoek — There has been a significant increase in the total national debt since 2007 when the total debt level was just under N$40 billion.
As of December 2012 the total debt, including government, corporate and individual debts, stands at N$69.12 billion, an increase of 14.52 percent from the N$60.4 billion debt level in 2011. "The increase is primarily driven by a 26.3 percent increase in corporate credit extension," according to the local brokerage firm Simonis Storm Securities. The figures are from the Bank of Namibia.
The debt is apportioned as N$20.04 billion for corporate, N$31.8 billion for individuals, and N$17.28 billion in government debt. On a monthly basis total debt grew by N$140 million or 0.20 percent in December 2012 alone, while a 1.6 percent drop in corporate debt largely set off the 1.42 percent monthly credit growth in individual debt. Government debt grew by only 0.12 percent.
Total credit to individuals increased 11.75 percent from N$28.45 billion in 2011, with mortgage loans as the largest driver. Mortgages increased by N$2.64 billion over the year. Domestic government debt remained relatively stable in December at N$17.28 billion, translating to an increase of 7.79 percent for the year.
The government has continued to extend the average maturity of its debt by more than 53 percent with maturities greater than 12 months. This compares to only 42 percent a year ago. On a year-to-year basis, corporate debt grew by 26.28 percent driven mainly by overdrafts and other loans that spiked in November and December.
Analysts say the spike is an indication that companies may have resorted to short-term unsecured financing to carry them through the festive season. On a monthly basis, corporate debt was 1.60 percent less than in November. The increase in instalment credit was more than offset by a drop in overdrafts and mortgage loans.
Namibia's foreign reserves decreased by N$531 million in December to N$14.89 billion, a decrease of 3.44 percent for the month, although on a year on year basis, reserves are 3.36 percent higher than December 2011.