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Namibian growth expected to temporarily slow down: IMF

Xinhua, September 22, 2016 Adjust font size:

Growth in Namibia is expected to temporarily slow down in 2016 to 2.5 percent, compared to 5.3 in 2015, as the government starts consolidating and construction activity slows down, according to findings released here Wednesday from the International Monetary Fund team.

The IMF team led by Geremia Polomba was in Namibia on Sept. 8-21, conducting the 2016 Article IV Consultation discussions.

"Risks to this outlook are tilted to the downside and include volatile SACU (Southern African Customs Union) revenue, further commodity price declines and possible sovereign debt credit downgrades," Poloma said in a statement.

According to him, Namibia's key challenges going forward are to preserve macroeconomic stability, and make inroads in reducing high unemployment and income inequality.

"The government and the Bank of Namibia have already taken steps to counter declining SACU revenue and rising inflation, however fiscal and external vulnerabilities are rising and additional actions are required," he said.

Palomba said the performance is expected to accelerate to above 5 percent in 2017 and 2018 as production from new mines ramp up.

Furthermore, Polomba welcomed the Namibian authorities commitment to undertake additional actions to preserve debt sustainability while containing the impact on growth in the context of the upcoming Mid-Year Budget Review Policy Statement.

Meanwhile, he said the financial sector remains sound and the authorities are taking steps to curb possible risks and advance key financial sector reforms.

Polomba said in terms of various fronts to tackle high employment among youth, a well-focused package of structural reforms to address the lack of skilled workers and to simplify business regulations has the potential to boost employment. Enditem