Windhoek – Namibia’s domestic financial system is described as stable, sound, and robust following a recent assessment by the Financial System Stability Committee (FSSC). The FSSC convened on October 3, 2024, to evaluate the resilience of the financial environment against international and local threats.
According to Namibia Press Agency, the Bank of Namibia (BoN) released a statement post the FSSC meeting, highlighting the current global economic trends and their potential impacts on Namibia. The International Monetary Fund (IMF) projects global economic growth to slow down to 3.2% in 2024 from 3.3% in 2023. This anticipated slowdown is mainly due to stricter monetary policies across various economies. BoN emphasized the persistent inflationary pressures, primarily from ongoing challenges in reducing service costs. Additional global risks include geopolitical tensions, trade disputes, and regional military conflicts, all contributing to uncertainties impacting economic stability.
Domestically, the BoN noted consistent economic activity in the first half of 2024, with significant contributions from the mining and livestock marketing sectors enhancing the overall economic landscape. However, challenges were observed in the secondary sector, such as declines in local electricity production and diamond processing activities. Despite these setbacks, there was notable growth in construction and manufacturing sectors including blister copper, cement, beer, and soft drinks production.
The tertiary sector, supported by wholesale, retail, information and communication technology, and tourism, showed robust performance. Yet, the forecast for Namibia’s GDP growth for 2024 is pegged at a slower rate of 3.1%, influenced by drought conditions, decreasing diamond prices, and subdued global demand.
The banking sector in Namibia remained liquid, profitable, and well-capitalized, with noticeable growth in net loans and advances. Additionally, non-bank financial institutions continued to show stability, buoyed by steady demand for their services and favorable global market conditions.