Retail industry records negative growth

16 Jan 2019 07:30am
WINDHOEK, 16 JAN (NAMPA) – The Wholesale and Retail Trade (WRT) sector in Namibia has recorded various degrees of negative growth for eight consecutive quarters, Policy Analyst at the Namibia Trade Forum Claudia Boamah recently announced in a media statement.
The statement explained that the sector recorded a negative 5,8 per cent in the third quarter of 2018, which is concerning when one takes into account the fact that it has the potential to grow at almost 15 per cent per annum.
It said, a recovery looks very unlikely in the near future as Irwin, Jacobs, Greene Capital and the Institute for Public Policy Research's leading indicator points to further weakness in the economy as it remains below 50 index points.
It further highlighted that revenue on average grew by a mere two per cent among supermarkets and clothing retailers respectively and while vehicle sales improved on an annualised quarterly basis, growth in that subsector remains negative.
According to the statement, the WRT sector's growth improved by 250 basis points from negative 8.3 per cent during the third quarter of 2017.
Domestic demand continues to decline as consumption by households and the government slowed down, the statement further read.
The critically high level of unemployment and slow paced rate of income growth underpin lower demand by households and contractionary fiscal policy can account for the reduction in public sector spending, it pointed out.
It suggested that the collapse of retail tourism by the Angolan consumer is also a major contributing factor to the weakness in the retail sector.
'In light of the grim macroeconomic conditions, domestic business sentiment came down from an earlier spike in 2018,' the statement added.
Considering the main factors which contributed to the slowdown in the retail sector are either structural, necessary or beyond the country's control, it would be unrealistic to expect a complete reversal in the negative growth trend in the near future, the statement further posited.
(NAMPA)
CJN/EK/HP