Namibia’s budget projections indicate a modest increase in growth and a reduction in the deficit

The finance minister stated in a budget speech on Thursday that Namibia’s economic growth is expected to improve modestly this year, and the budget deficit is projected to decrease.

The public finances of the resource-rich South African country have been adversely affected by a decline in global diamond prices, though robust gold and uranium prices have provided some relief.

The goal is to achieve its initial crude oil output by 2030, a move that has the potential to significantly change its modest economy.

Finance Minister Ericah Shafudah announced that the gross domestic product is projected to grow by 3.1% this year, surpassing last year’s growth of 2.9%.

The overall budget deficit is projected to decline to 5.5% of GDP in the fiscal year beginning April 1, down from 6.6% in the current fiscal year.

The finance ministry seeks to reduce the deficit further, targeting 3.8% for the 2027/28 fiscal year and 3.3% for 2028/29.

Total government debt is projected to reach 65.2% of GDP this fiscal year, with expectations to stabilize around 67.5% within the government’s medium-term framework.

Shafudah stated that the goal was to progressively reduce the debt-to-GDP ratio to 60%.