14 Dec 2018 16:10pm
WINDHOEK, 14 DEC (NAMPA) Namibias domestic economy is expected to contract by 0,2 per cent based on weaker year-to-date performance in wholesale and retail trade, before a recovery in 2019.
The contraction in real gross domestic product is expected to diminish by 0,2 per cent from a deeper shrink of 0,9 per cent in 2017, after which a positive growth rate of 1,5 per cent is projected in 2019.
Bank of Namibia Deputy Director for Corporate Communications, Kazembire Zemburuka said in a statement issued on Friday the downward revision in the 2018 growth was mainly reflected in tertiary industries.
Growth in sectors such as wholesale and retail trade, real estate and business services, hotels and restaurants, government sectors and taxes on products was likely to be significantly lower than earlier anticipated.
Zemburuka said risks to domestic growth included a weak recovery in the countrys trading partners and slow recovery in international commodity prices, particularly for uranium.
Should the economic recovery in Angola fail to materialise, the impact would continue to be felt in sectors such as wholesale and retail trade, education and real estate and business services, thereby worsening growth prospects in these sectors, he said.
A slowdown in demand for minerals from the countrys major trading partners such as France and China would also increase the risk to projected growth for primary industries.
International trade wars may also inhibit Namibias exports, while near-zero growth in South Africa weighs on the countrys recovery prospects in future, he said.
Meanwhile, risks to the short-term global growth outlook have turned out lower than the main forecast due to elevated policy uncertainty.
Global growth for both 2018 and 2019 has been revised to downwards by two percentage points in October 2018.
The downward revision was due to suppressed activity earlier in the year in some advanced economies, the negative effects of the protective trade measures as well as a weaker outlook for some key emerging and developing economies.
Risks to the global outlook in the medium term include rising trade barriers and a reversal of capital flows to emerging market economies, increased geopolitical risk and pronounced policy uncertainty, Zemburuka said.