Discord over FNB GDP projections

10 Jun 2013 10:37

Projected Gross Domestic Product statistics released by First National Bank Namibia last week have created discord over the actual rate of growth expected for the economy this year.
According to the FNB Namibia analysis partly done by the financial institution’s Head of Research, Daniel Motinga, and the country’s GDP figure will be marked at 4.5%.
However, Bank of Namibia and the Namibian Statistics Agency have pinned the country’s GDP figures at an average of 4% based on anticipated better performance from the mining sector which contributes 11% to the country’s growth and an improved performance from both the tertiary and secondary industries.
The figures from FNB, though near the overall anticipated by the central bank and fiscus authorities have a variance of one percentage points for the country’s anticipated growth rate.
In actuality, the country has maintained a reasonable growth of about 4.4% in the past three years although different institutions have pegged their projections on different figures.
GDP refers to the actual growth of the economy on an annual basis and is driven by various internal and external figures.
FNB base their projections on the mining sector which grew by a considerate 17%.
According to FNB, a relatively robust performance from the uranium mining sector which grew by about 4% also helped the projected growth for the year.
However, the statistics do not tally with the projections made by the BoN in their last monitory policy statement.
BoN governor, Ipumbu Shiimi, in the monitory policy review says the country can expect growth projections to be anything between 3.8% and 4%.
Shiimi, however, emphasises that these figures are subject to adjustments.
“On average, we expect stable performance of the economy in the year because of a good performance from the mining sector and our GDP figures should be anywhere near the 4% mark. However, there are also possibilities of change depending on the developments in both the local and international economy,” Shiimi told The Villager upon enquiry at his last MPS.
The scenario being created for the anticipated growth figures for the economy are reminiscent of last year when the central bank pinned their growth projections at 4% but ended up adjusting them downwards as the global economic developments continued to create pressure on the local economy while production targets in some sectors were not met.
Although Namibia is a largely net importing economy, the country’s GDP is driven by the primary and the tertiary industries since there are not many contributions from the manufacturing sector which is overshadowed by South African companies.