The trade balance for Namibia is anticipated to maintain its persistent deficit. Namibia’s current account maintains a deficit position, with a trade balance of N$3.3 billion, widened by 28.2 percent year on year in September.
This underscores the ongoing trend of a persistent net financial outflow within the country’s economic landscape, according to a report by Simonis Storm.
The wider trade deficit was driven by a combination of lower trade volumes and import earnings outweighing export earnings, the report said. Exports amounting to N$7.8 million while the import bill was N$11.1 million in September.
Namibia’s status as a net importer of goods significantly influences inflation dynamics, and the confluence of this factor with the weakness of the rand compounds the challenges faced by Namibian consumers, the report said.
The report said a glimmer of hope emerges from the government’s strategic move to ban the export of raw earth metals.
“This policy shift is poised to stimulate investments within Namibia, fostering the establishment of processing companies in the country. This, in turn, promises to usher in a positive tide by augmenting employment opportunities and bolstering economic growth,” Simonis said.
President Hage Geingob has reiterated Namibia’s steadfast commitment to halting the export of raw metals and has outlined the reasoning behind the country’s ban on exporting unprocessed lithium and critical minerals.
Simonis said the overarching objective is to stimulate the growth of domestic processing capabilities, ultimately leading to increased value addition to the Gross Domestic Product (GDP) and a bolstering of export earnings over the long term.
This strategic decision was prompted by the government’s prior restriction on the export of unprocessed critical metals in June, aligning Namibia with Zimbabwe’s approach of mandating local processing for all domestically mined lithium.
“However, within this challenging scenario, a glimmer of hope emerges from the government’s strategic move to ban the export of raw earth metals. This policy shift is poised to stimulate investments within Namibia, fostering the establishment of processing companies in the country. This, in turn, promises to usher in a positive tide by augmenting employment opportunities and bolstering economic growth,” said Simonis.
