Trade Deficit widens by 41.9%
The latest trade statistics reveal that Namibia’s trade deficit has widened by 41.9%, from N$6.9 billion to N$9.9 billion.
The trade deficit has widened as a result of a high import bill of N$23.8b compared to exports of N$13.9b.
The statistics released by the Namibian Statistics Agency (NSA) note that the export revenue stands at N$22.7b in the second quarter of the year, N$8.8b less than the amount recorded in the same period of the preceding year.
Expenditure on imports are valued at N$29.7b. This is however N$5.9b less than the amount recorded in the preceding year during the same period.
“Thus, the widening deficit continues to underscore Namibia’s dependence on imports, and her vulnerability to any slowdown in supply from her largest trading partner, South Africa,” the report noted in part.
Meanwhile, statistics show that most of the exports go to Botswana, South Africa, Switzerland, Angola and Zambia.
“The aforementioned markets accounted for 63.4% of Namibia’s total export earnings, up from 62% in the previous quarter, and from 41% in the corresponding quarter of 2014. Export earnings from these markets advanced slightly by 5% to N$8.8b from N$8.4b recorded in the previous quarter. When compared to the same quarter of the preceding year, export earnings fell by 5% from N$9.3b,” the report stated.
The trade statistics noted that the export earning in the second quarter is a reflection of the fall in external demand, mostly from Botswana, Switzerland, Angola and Spain.
“The decline in export revenues from Botswana was reflected in the value of diamonds, which fell by 7% to N$3.3b from N$3.6b in the corresponding quarter a year ago, while the decline in exports revenue from Switzerland was reflected in the value of copper ores and diamonds, which fell to N$0.383b, from N$1.2b recorded in quarter of 2014,” the trade statistics noted.
However, the decline in exports to Angola was marked in the value of exported vehicles, boilers, electrical machinery and equipment, as well as the value of exported furniture and fish which dropped from N$0.685b in the second quarter to N$0.403b in the period under review. The fish dented the overall value of exports to Spain.
South Africa, China, Switzerland and India were the primary sources of imports for Namibia during the period under review.
The trade reports mention that these markets accounted for 82% of total imports, up from 48% in the previous quarter.
The statistics added that comparing to the previous quarter of the preceding year, the contribution by the above mentioned markets to total imports was constant.
“Overall imports from the aforementioned markets grew by 36% to N$19.6b from N$14.4b in the previous quarter, when compared to the same quarter of the preceding year, the cost of imported commodities rose by 22% from N$16b,” noted the trade statistics in part.
Meanwhile, there was a decline in the import bill which revealed a dwindling domestic demand for commodities mainly supplied by the Democratic Republic of Congo, Germany and the United States of America (USA).
The major declines were noticeable in Germany as the import bill fell by 64.8%, the USA 46% and in DRC the exports dropped by 36.5%. Meanwhile, the value of imports from South Africa, China and India, strengthened significantly.
“India replaced Switzerland as Namibia’s third largest import market, following shipment of mineral fuels and oils to the value of N$0.522b. Botswana moved down one place to occupy the fifth position as Namibia’s source of imports,” the report stated.
The top five leading export commodities during the second quarter of 2015 were diamonds, fish, copper cathodes, copper ores, and Zinc.
“The overall export revenue generated from these commodities rose by a mere 3.6% to N$10b from N$9.7b in the previous quarter of 2014. However, when compared to the same quarter of 2014, export revenue from the aforementioned commodities dropped by 7.2% from N$10.8b,” the report noted.