Windhoek: The Namibian Government has outlined a strategic plan to settle its US dollars 750 million (N dollars 13.6 billion) Eurobond, which matures on 29 October 2025. A Eurobond is an international bond issued in a currency different from the currency of the country where it is issued. These bonds are used by governments and corporations to raise capital from international investors. Namibia has previously utilized Eurobonds to finance budget deficits and infrastructure projects.
According to Namibia Press Agency, Finance Minister Ericah Shafudah, while presenting the national budget on Thursday, assured that measures are in place to ensure a smooth redemption process without excessive financial strain. “We have successfully accumulated US dollars 463 million (N dollars 8.46 billion) in the Sinking Fund over the past financial years,” the minister said. The government intends to add another US dollars 162 million (N dollars 3 billion) to the fund during the 2025/26 financial year, leaving a balance of US dollars 125 million (N dollars 2.3 billion) to be refinanced through the domestic market.
According to the minister, given current interest rate levels, the government considers sourcing funds from the domestic market the most optimal approach. “We have sufficient liquidity and a demonstrated appetite for government securities, however, I can assure that post-FY2025/26, the government would carefully balance domestic financing needs to avoid crowding out private sector funding,” she said.
Apart from the Eurobond, the government is also managing other significant financial obligations. This includes repaying the International Monetary Fund (IMF) Rapid Financing Instrument, with N dollars 2.3 billion scheduled for settlement in FY2025/26 and a final tranche of N dollars 1.2 billion in FY2026/27. The minister expressed confidence in the government’s debt management strategy, stating that the planned approach will stabilize the national debt over the medium term. “We project the total public debt to moderate from 66.0 per cent of GDP in FY2024/25 to 62.0 per cent in FY2025/26,” she said.
Once the Eurobond and IMF obligations are settled, over 80 per cent of Namibia’s debt stock will be denominated in the domestic currency. This is expected to reduce exposure to exchange rate risks and strengthen domestic capital markets. The minister further announced that the government will explore funding from multilateral organizations to finance infrastructure projects and consider off-budget financing solutions in partnership with the private sector.