Worst economic performance since Covid recorded

Over the past two quarters, the Namibian economy has experienced its weakest performance since the Covid-19 pandemic struck the country in 2020.This is due to the drought and particularly subdued diamond production stifling growth. Both agriculture and mining are now officially in a recession, according to the latest data from the Namibia Statistics Agency (NSA). Overall, real economic growth in the third quarter was 2.8%, a slight improvement from the 2.7% of the previous quarter. In the same two quarters last year, growth was 3.1% and 3.4%, respectively. Silver Lining Despite the overall weaker performance of the economy, there is some good news, according to Cirrus Capital. Only three of the 17 sectors of the economy were in the red in the past quarter: agriculture and forestry, mining, and water and electricity. The latest figures show that the economy is no longer solely driven by mining, Cirrus notes. "This is an encouraging sign of Namibia’s economic recovery, which was initially highly concentrated," the analysts note. Agriculture The agriculture and forestry sector recorded growth of -6.3% in the last quarter, after contracting by 1.2% in the second quarter. Two consecutive quarters of negative growth mean this sector is now technically in a recession. The ongoing drought and fewer animals being sent to market led to a contraction of 8.1% in the livestock subsector. On the other hand, better grape production boosted crop farming by 0.4%. Mining Falling diamond production caused growth in the mining sector to plummet to -6.7%. Along with the 4.0% contraction in the second quarter, mining is also officially in a recession. A declining global demand for diamonds, and consequently smaller local production, led to a 14.7% contraction in the diamond subsector last quarter. However, uranium, metals and salt performed well and grew positively. Despite the overall weaker performance, mining remains the backbone of the economy. In real terms, taking inflation into account, mining contributed nearly N$4.3 billion to Namibia's total Gross Domestic Product of about N$38 billion in the last quarter. Tourism Hotels and restaurants, a measure of tourism, have had their eleventh consecutive quarter of positive growth. With growth of 3.7%, the past quarter was the sector's best performance so far this year. The recovery in tourism is reflected in rising flight arrival numbers, as well as more international, regional and local visitors requiring accommodation and other services in the tourism sector.Consumer Wholesale and retail trade saw about N$3.4 billion flow through the economy in real terms in the last quarter. The sector grew by 5.6%, marking the 14th consecutive quarter of recovery after being in a recession for four years, starting in early 2017. Reduced income tax and lower interest rates are fuelling consumer spending, notes Cirrus. All income taxpayers now have between N$750 and N$1 542 more in their pockets each month. This windfall is expected to further stimulate spending in the current quarter, according to Cirrus.

Worst economic performance since Covid recorded

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Namibian Sun 2025-03-28

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Worst economic performance since Covid recorded

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Namibian Sun 2025-03-28

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