28 Feb 2018 15:10pm
WINDHOEK, 28 FEB (NAMPA) - Namibia's economic growth rate, estimated at -0,6 per cent in 2017, is expected to gradually improve to 1,4 per cent and 2,1 per cent in 2018 and 2019, respectively.
Based on the International Monetary Funds World Economic Outlook update for January 2018, global growth is projected to remain strong during 2018 and 2019, with Sub-Saharan Africa's growth also expected to increase.
These findings are contained in the Bank of Namibia (BoN)s latest Economic Outlook Update, availed to the media on Wednesday.
According to the outlook, the reduction in growth is ascribed to contractions in sectors such as construction, wholesale and retail trade, public sector, as well as slower growth rates for manufacturing, electricity and water sectors.
Going forward, growth is projected to improve steadily to 1,4 per cent and 2,1 per cent in 2018 and 2019 respectively, the BoN stated.
Over the medium term, growth is projected to improve due to the expected moderate contractions in wholesale and retail trade and construction sectors.
It is expected that growth will be supported mainly by the anticipated improvements in wholesale and retail trade, construction and sustained growth for transport and communication, BoN reports.
Furthermore, uranium mining is expected to register better growth rates during 2018 and 2019 and hence sustain the mining sector while at the same time supporting overall growth.
Risks to the domestic economic outlook remain, mainly in the form of persistently low uranium prices and unpredictable rainfall, the report stated.
Risks to the domestic outlook include low international prices for uranium, erratic rainfall and possible further credit rating downgrades for the domestic economy as well as for the South African economy.
On the global front, the economy is projected to grow by 3,9 per cent both in 2018 and 2019, which is an improvement from 3,7 per cent estimated for 2017.
This growth will be supported by favourable economic policies and better than earlier expected growth outcomes in major advanced and emerging market economies.
Growth in Sub-Saharan Africa is also estimated to increase to 3,3 per cent and 3,5 per cent in 2018 and 2019, respectively, compared to 2,7 per cent in 2017.
The strong global growth may have positive spill overs for the Namibian economy going forward, BoN said.
Risks to the near-term global outlook are expected to remain broadly balanced but tilted to the downside in the medium term, the statement noted.