Namibia raises economic growth forecasts for this year and next

By Nyasha Nyaungwa

WINDHOEK (Reuters) -Namibia now expects economic growth of 3.5% in 2023 and 2.9% next year, up from earlier forecasts of 3.2% and 2.2%, supported by higher manufacturing output and strong demand for services, Finance Minister Ipumbu Shiimi said on Tuesday.

Shiimi gave the new projections at a mid-year budget review in parliament, where he also said the government was sticking to its forecast for a 4.2% budget deficit this fiscal year.

Although the finance minister was upbeat about the country’s secondary and tertiary industries, he warned that primary industries like mining and agriculture were under pressure.

“Value addition in the primary industry is projected to trend lower due to reduced output than initially anticipated in the mining sector as well as the agriculture sector which is expected to be negatively affected by the ongoing drought,” Shiimi said.

Among risks, he cited volatile global commodity prices and water supply constraints.

Namibia is a major diamond producer and has significant deposits of lithium and rare earth minerals used in electric vehicles and wind turbines.

($1 = 18.7390 Namibian dollars)

(Reporting by Nyasha Nyaungwa; Writing by Bhargav Acharya; Editing by Alexander Winning and Tomasz Janowski)