Namibia QER Q1 2019 - Namibia Quarterly Economic Review January-March 2019

14 February Namibian inflation drops Consumer price inflation in Namibia fell from 5.1% in to 4.7% (NSA) December to 4.7% in January according to the Namibia Statistics Agency (NSA) 13 February Bank of Namibia holds The Bank of Namibia’s Monetary Policy Committee repo rate at 6.75% (Bank (MPC) held the repo rate at 6.75% and said it expected of Namibia) the economy to expand in 2019. [...] The increase in acquisition of capital assets is due to the increase in spending on capital projects while that of capital transfers is due to the resumption of the N$200m annual allocation for land purchases under the Land Acquisition and Development Fund. [...] He goes on to say that “the Government appreciates the common understanding and commitment of the civil service and organised labour for the contribution to the policy efforts to exercise restraint on remuneration increases and to restore long-term sustainability”. [...] Given the forecasts for revenue and expenditure over the three years of the Medium-Term Expenditure Framework (MTEF), the budget deficit is forecast to decline to 3.5% and then 2.8% by 2021/22 with the total stock of public debt supposedly peaking at 52.3% of GDP – an all-time high – in FY2021/22. [...] To a limited extent this has been achieved but questions remain about the sustainability of debt given the country’s poor 13 The Namibia Quarterly Economic Review is compiled by the Institute for Public Policy Research and is financially supported by the Hanns Seidel Foundation.