CHAMWE KAIRA
Namibia’s trade prospects in 2025 will be shaped by regional economic shifts, global trade policy changes, and infrastructure developments.
While expanded logistics capacity and trade agreements create opportunities, external risks, including South Africa’s economic pressures, US tariff policies, and exchange rate volatility, require careful management, Simonis Storm Securities has noted in a report.
As Namibia’s largest trade partner, South Africa’s economic health has direct implications for Namibia’s trade dynamics.
A South African slowdown, exacerbated by global trade disruptions, inflationary pressures, and currency volatility, could weaken demand for Namibian exports.
“Sectors such as mining, agriculture, and manufacturing, which are closely linked between the two economies, may experience reduced trade flows and investment,” it noted.
Additionally, a weaker rand could increase the cost of South African imports, fuelling inflationary pressures in Namibia.
The renewed US tariffs on Mexico (25%) and China (10%) could have knock-on effects for Namibia via South Africa. Given South Africa’s dependence on US exports, any slowdown in demand for metals, vehicles, and mining products could filter through to Namibia’s trade performance.
“Furthermore, a potential reduction in US foreign aid to South Africa could dampen investment flows within the region, indirectly affecting Namibia’s economic outlook.”
Simonis said Namibia’s expanding role in global value chains, supported by improved logistics, may help cushion some of these external risks.
Due to the Namibian dollar’s peg to the South African rand, fluctuations in the rand directly impact Namibia’s trade position.
“A weaker rand could increase the cost of imports, raising inflation and squeezing household purchasing power. However, it could also boost Namibia’s export competitiveness, making diamonds, uranium, and fish more attractive on global markets. The net effect will depend on broader global demand trends and regional trade stability,” it noted.
Simonis said to sustain long-term trade competitiveness, Namibia needs targeted infrastructure investments and expanding market access through deeper integration into SADC and AfCFTA.
Other measures include reducing trade barriers, modernising customs procedures and cross-border logistics, and diversifying export destinations to reduce dependency on South Africa as a primary trade route.
The report further said to sustain long-term trade competitiveness, targeted infrastructure investments are essential.
These include road and rail connectivity.
“Namibia stands at an intriguing point in its trade trajectory, with infrastructure expansion and trade-friendly policies driving momentum. However, South Africa’s economic headwinds, shifting US trade policies, and exchange rate fluctuations require careful navigation. By focusing on market diversification, logistics modernisation, and policy efficiency, Namibia can enhance its resilience and competitiveness, positioning itself as a leading trade hub in Southern Africa.”
