Namibia's economy expected to contract further in 2020

Source: Xinhua | 2020-06-18

Namibia's domestic economy is projected to contract further this year and inflation is also projected to average around two percent in 2020, Bank of Namibia's deputy governor, Ebson Uanguta said Wednesday.

Namibia's economic activity declined during the first four months of 2020, relative to 2019 and the contraction was widespread among sectors, including the mining, manufacturing, wholesale and retail trade, transport and the tourism sectors, said Uanguta in a monetary policy announcement.

"A few economic indicators such as local electricity generation and building plans approved, however, showed some improvement during the first four months of 2020, relative to the corresponding period of 2019," he said.

According to Uanguta, annual average inflation declined to 2.1 percent during the first five months of 2020 compared to 4.4 percent in the corresponding period of 2019.

The decline was mainly due to a decrease in inflation for the categories of transport, housing, and food during the period under review, he added.

"Overall inflation is projected to average around two percent in 2020," he said.

Meanwhile, Uanguta said the stock of international reserves remained sufficient to support the currency peg.