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After years of robust growth, Namibian economy entered into recession in 2019 and 2020, impacted by the dissipation of temporary stimuli, a drop in raw material prices, a severe drought and then the Covid-19 pandemic. From a contraction of -8% GDP in 2020, the economy started to recover in 2021, growing by 1.3% (IMF). Economic growth is expected to strengthen to 3.6% in 2022 and 3.1% in 2023 (IMF), supported by mineral exports and private consumption (Coface).
Namibia has experienced a period of exceptional growth masking increasing macroeconomic imbalances, a slowdown in productivity and a decline in external competitiveness. While the economy was rebalancing, it was hit by a severe drought and the consequences of the pandemic-induced lockdown. Budget deficit worsened to -9.5% GDP in 2020, and while it narrowed to -8.4% GDP in 2021 and is expected to further decrease to -7.6% GDP in 2023, it remains very high (Coface). Similarly, public debt increased to an estimated 69.9% GDP in 2021, and is forecast to further widen to 72.6% GDP in 2023 before starting to decline to 71.7% GDP in 2023 (IMF). To reduce the risk associated with indebtedness, the authorities are attempting to diversify their sources of financing (Coface). The exchange risk remains limited because this debt is mainly domestic, issued on long-term maturities and denominated in local currency. Inflation increased from 2.2% in 2020 to 4% in 2021, and is expected to reach 4.5% in 2022 and 2023, driven by food and transport prices (IMF). With the Namibian dollar pegged to the rand, the level of inflation will remain vulnerable to the volatility of the South African currency. The government priorities are to support recovery and economic growth, to ensure the sustainability of public finances and debt through fiscal consolidation, to reform the tax system and to implement structural policy reforms. The government's priority is also to better redistribute wealth while maintaining a favorable business environment. Growth has not accompanied job creation and the extreme social and economic inequalities inherited from apartheid persist despite the generous spending allocated to social programs.
Namibia is one of the countries with the highest inequalities. In part due to impact of the pandemic, poverty rate is projected to stay near 65% through 2022 (World Bank) and around 15% of the adult population is infected with the AIDS virus. Unemployment is high and affected 20.4% of the population in 2020 (World Bank), with a notable disparity between rural (39%) and urban areas (30%), among women (38%) and young people (43%).
Main Indicators | 2019 | 2020 | 2021 (e) | 2022 (e) | 2023 (e) |
---|---|---|---|---|---|
GDP (billions USD) | 12.56 | 10.71 | 12.21 | 13.12 | 13.86 |
GDP (Constant Prices, Annual % Change) | -0.6 | -8.0e | 1.3 | 3.6 | 3.1 |
GDP per Capita (USD) | 5,109e | 4,276 | 4,693 | 4,853 | 4,933 |
General Government Gross Debt (in % of GDP) | 59.6 | 65.3e | 69.9 | 72.6 | 71.7 |
Inflation Rate (%) | 3.7 | 2.2 | 3.6 | 5.5 | 4.6 |
Current Account (billions USD) | -0.22 | 0.25 | -0.89 | -0.51 | -0.18 |
Current Account (in % of GDP) | -1.8 | 2.4 | -7.3 | -3.9 | -1.3 |
Source: IMF – World Economic Outlook Database , October 2021
Note: (e) Estimated Data
Namibia is one of the most important diamonds exporters and the 3rd largest uranium producer in the world. The country also has one of the most productive fishing industries in the world. Agriculture accounts for 9.2% of the Namibian economy and employs more than a fifth of the workforce (World Bank, 2020). The country's arid climate and geographic conditions do not favour farming and the crop variety is rather limited. Major crops include: maize, millet and sorghum. The livestock sector is productive and export oriented. Beef accounts for the largest share of livestock exports. Fishing is another important component of the primary sector (accounting for almost 25% of all activities in the primary sector), as Namibian waters are rich in fish.
The secondary sector contributes to 26.3% of GDP and employs about 16% of the active population. The sector is characterised by the predominance of the mining industry thanks to the country's rich subsoil. Major mining products include: diamonds, uranium, lead, copper and arsenic. Diamonds account for almost 70% of all mining exports. While Namibian diamond production is less significant than neighbouring countries (Botswana, South Africa and Zimbabwe), the country is among the world's first in value per unit, with an average price of USD 578 per carat (De Beers Interim Financial Reports 2021). Namibia also has the largest marine mine in the world. Offshore diamond production is increasing (it provides 75% of total production according to Coface), while onshore extraction is decreasing due to the exhaustion of terrestrial deposits. In addition, Namibia is the third largest producer of uranium in the world, and is home to two mines capable of producing 10% of the world output. Husab's uranium mine is the third largest surface uranium mine in the world. Food processing (beef and fish) is the largest non-mining component of the secondary sector.
Services account for 59.1% of GDP and employ 62% of the working population. Namibia's diverse landscapes and extensive wildlife offers significant tourism assets and as such, tourism is a major source of income. Its direct contribution to GDP is around 10%. The construction sector is the activity that suffered most during the recession and is struggling to regain a positive momentum.
Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
---|---|---|---|
Employment By Sector (in % of Total Employment) | 21.9 | 16.4 | 61.8 |
Value Added (in % of GDP) | 9.0 | 26.5 | 57.9 |
Value Added (Annual % Change) | 5.9 | -14.6 | -5.6 |
Source: World Bank - Latest available data.
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Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
---|---|---|---|---|---|
Namibian Dollar (NAD) - Average Annual Exchange Rate For 1 MUR | 0.41 | 0.39 | 0.39 | 0.41 | 0.42 |
Source: World Bank - Latest available data.
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The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
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Namibia is very open to foreign trade, which represents 76% of the country’s GDP (World Bank). Customs duties are low and there are no major trade barriers. The country's economy is closely linked to that of South Africa, with the Namibian dollar pegged to the South African rand. The country is a member of the SACU (Southern African Customs Union) and SADC (Southern African Development Community), whose free-trade zone (FTZ) was inaugurated in 2008. Namibia also ratified the African Continental Free Trade Agreement. In 2016, the EU signed an EPA with the SADC EPA Group comprising Botswana, Lesotho, Mozambique, Namibia, South Africa and Swaziland. Copper, diamonds, uranium, gold, fish, cobalt and live animals continue to lead the market for export commodities. Copper, mineral fuels and oils, diamonds, vehicles, and cobalt lead the list of major imports to Namibia.
Namibia's exports are mainly directed to China (34.1% of exports), South Africa (14.5%), Botswana, Belgium, Spain, Zambia and the Democratic Republic of Congo. South Africa (36.2% of imports), Zambia, the Democratic Republic of Congo, China, Bulgaria, India and the United States are the main suppliers.
Namibia’s trade balance is structurally in deficit because of Namibia’s high demand for high-valued manufactured commodities and machinery, and exports of mainly primary commodities that are of low value, with the exception of diamonds. Nonetheless, the trade deficit has followed a downward trend in recent years, dropping from USD -2.9 billion in 2015 to USD -907 million in 2020 (World Bank). This trend is expected to continue thanks to higher exports of uranium and fishery products, and lower imports resulting from weak consumption and low oil prices. In 2020, merchandise exports amounted to USD 5.6 billion, while imports reached USD 6.8 billion. Exports of services reached USD 352 million, while imports amounted to USD 419 million (WTO). Exports of goods and services decreased by -17.7% compared to 2019, while imports decreased by-15.7%. After the decrease in trade volume due to the Covid-19 pandemic, mining exports are expected to rebound in 2022, and services should benefit from a revival in tourism (Coface).
Foreign Trade Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
---|---|---|---|---|---|
Imports of Goods (million USD) | 6,420 | 6,688 | 8,289 | 8,086 | 6,823 |
Exports of Goods (million USD) | 4,397 | 4,799 | 7,488 | 6,256 | 5,600 |
Imports of Services (million USD) | 809 | 637 | 533 | 539 | 419 |
Exports of Services (million USD) | 660 | 693 | 728 | 646 | 352 |
Imports of Goods and Services (Annual % Change) | 3.9 | -10.1 | 1.3 | -3.9 | -15.7 |
Exports of Goods and Services (Annual % Change) | -0.6 | 1.9 | 15.9 | -9.4 | -17.7 |
Imports of Goods and Services (in % of GDP) | 59.0 | 47.6 | 45.8 | 46.1 | 41.5 |
Exports of Goods and Services (in % of GDP) | 35.0 | 33.6 | 35.8 | 35.8 | 33.0 |
Trade Balance (million USD) | -2,412 | -1,811 | -1,555 | -1,302 | -907 |
Trade Balance (Including Service) (million USD) | -2,547 | -1,664 | -1,377 | -1,212 | -986 |
Foreign Trade (in % of GDP) | 94.0 | 81.2 | 81.6 | 81.9 | 74.5 |
Source: WTO – World Trade Organisation ; World Bank , Latest Available Data
Main Customers (% of Exports) |
2020 |
---|---|
China | 34.1% |
South Africa | 14.5% |
Botswana | 8.0% |
Belgium | 5.2% |
Spain | 4.6% |
See More Countries | 33.5% |
Main Suppliers (% of Imports) |
2020 |
---|---|
South Africa | 36.2% |
Zambia | 19.1% |
Democratic Republic of Congo | 5.5% |
China | 4.5% |
Bulgaria | 3.8% |
See More Countries | 31.0% |
Source: Comtrade, Latest Available Data
Source: Comtrade, Latest Available Data
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0.6 bn USD of services exported in 2018 | |
---|---|
65.77% | |
Personal travelPersonal travel | 64.35% |
OtherOther | 62.61% |
Health-related expenditureHealth-related expenditure | 1.09% |
Education-related expenditureEducation-related expenditure | 0.65% |
Business travelBusiness travel | 1.42% |
19.83% | |
Air transportAir transport | 19.74% |
PassengerPassenger | 18.44% |
FreightFreight | 0.79% |
OtherOther | 0.51% |
5.00% | |
2.96% | |
Telecommunications servicesTelecommunications services | 2.93% |
Postal and courier servicesPostal and courier services | 0.03% |
2.71% | |
1.61% | |
Construction abroadConstruction abroad | 1.61% |
0.91% | |
Miscellaneous business,...Miscellaneous business, professional, and technical services | 0.83% |
Research and developmentResearch and development | 0.08% |
0.83% | |
Audiovisual and related servicesAudiovisual and related services | 0.52% |
Embassies and consulatesEmbassies and consulates | 5.00% |
Other personal, cultural, and...Other personal, cultural, and recreational services | 0.31% |
0.24% | |
0.14% | |
Information servicesInformation services | 0.06% |
0.6 bn USD of services imported in 2018 | |
---|---|
36.63% | |
Miscellaneous business,...Miscellaneous business, professional, and technical services | 36.61% |
Research and developmentResearch and development | 0.02% |
24.25% | |
Air transportAir transport | 0.63% |
OtherOther | 0.50% |
PassengerPassenger | 0.13% |
10.70% | |
Construction in the compiling...Construction in the compiling economy | 10.70% |
9.00% | |
Personal travelPersonal travel | 6.94% |
Education-related expenditureEducation-related expenditure | 2.98% |
OtherOther | 2.10% |
Health-related expenditureHealth-related expenditure | 1.86% |
Business travelBusiness travel | 2.06% |
7.53% | |
5.10% | |
Information servicesInformation services | 0.02% |
2.91% | |
Telecommunications servicesTelecommunications services | 2.90% |
Postal and courier servicesPostal and courier services | 0.01% |
2.51% | |
1.12% | |
0.22% | |
0.04% | |
Other personal, cultural, and...Other personal, cultural, and recreational services | 0.04% |
Source: United Nations Statistics Division, Latest Available Data
The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
Source: World Press Freedom Index, Reporters Without Borders
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
For a general overview of trade restrictions due to COVID-19 pandemic, please consult the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
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Latest Update: July 2022