12 March 2014

Namibia Economy Tipped for Growth

Windhoek — THE Namibian economy is projected to grow by 5 percent this year on the back of an expected boom in diamond and uranium production.

Governor of the Bank of Namibia, Ipumbu Shiimi, made the projections in his latest monetary policy review statement.

“Although the figures are not yet concrete until the Central Bureau of Statistics releases their findings, we anticipate that the economy will grow by anything between the range of 4.8 percent to 5 percent,” Shiimi said.

He added the bank pinned its forecast on a better performance by the mining sector.

Mining contributes around 15 percent to the country's total gross domestic product. Other major contributors are the service industry and tourism.

Shiimi added that the growth would also heavily depend on the performance of the global economy as the country “did not operate in a vacuum.”

“We would also expect the mining to be better if the developed world economy continues to improve. This is where the majority of our produce are marketed so whatever affects them will affect us,” he said.

The Ministry of Finance backs the central bank's outlook.

The ministry, which forecast a robust performance by the mining sector, projected the same growth in its recently-announced budget of R60 billion.

First National Bank Namibia Chief Economist, Daniel Motinga, in his latest comment on the fiscal trends in the country also projected growth of about 5 percent.

He nonetheless expressed concern over the non adjustment of interest rates.

The positive projections have been made despite the government failing to close down on a budget deficit that stands at 7 percent.

Government argues the expansionary approach is meant to stimulate the economy and cut down on rampant unemployment that is now at 27 percent.

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