Nam deficit worsens in second quarter of 2019
30 Sep 2019 18:40pm
WINDHOEK, 30 SEP (NAMPA) - Namibia's current account deficit worsened during the second quarter of 2019 to N.dollars 3.1 billion from N.dollars 1.3 billion in quarter two of 2018.
This was revealed by the Bank of Namibia (BoN) in its quarterly bulletin for the second quarter of 2019 on Monday.
According to the central bank, the main drivers of the widening current account deficit were the substantial deterioration in the merchandise trade deficit as a result of growing import bill, coupled with increased net outflows on the services account.
The stocks of foreign reserves held by BoN increased, supported by higher Southern African Customs Union receipts coupled with lower foreign government payments. This resulted in an import cover of 4.5 months at the end of the second quarter of 2019.
Meanwhile, the Namibia Dollar depreciated against all major trading currencies due to the downside risks that emanated from the trade tensions between the United States and China coupled with South Africa's weak economic growth.
Activity in the major domestic economic sectors slowed during the second quarter of 2019, while inflation rose.
The mining sector reflected a decline in the production of both diamonds and uranium resulting in a weak performance in the domestic economy.
The central bank further explained the transport and communication sector also slowed due to a decrease in value addition in the communication sub-sector, while construction recorded weak activity as a result of reduced private sector construction works.
The manufacturing activity however increased as a result of a rise in the production of blister copper and refined zinc.