Chamwe Kaira
Namibia’s economy is expected to slow in 2025 before picking up again in 2026, with weaker activity in manufacturing and the primary industries weighing on output, the central bank said.
Real GDP growth is projected to ease to 3% in 2025 from 3.7% in 2024. Growth is then expected to accelerate to 3.9% in 2026.
The central bank attributed the slowdown primarily to a contraction in the manufacturing sector.
Output in the sector is expected to fall by 4.6% in 2025 after recording growth of 2.8% in 2024.
It said the decline is linked to sharp drops in basic non-ferrous metals, meat processing and diamond processing, with diamond activity returning to normal after a strong performance in 2024.
Primary industries are also expected to remain weak. Output is projected to contract by 0.1% in 2025, mainly because of lower livestock farming and continued weakness in diamond mining.
The central bank said the combined effect of these factors, together with persistent drought and slow global demand, will put pressure on short-term growth.
Compared to the August 2025 outlook, the new forecast reflects a downward revision of 0.5 percentage points for 2025 because of the weaker manufacturing outlook.
The central bank warned that the domestic economy faces downside risks, including reduced diamond export earnings as prices fall and lab-grown alternatives grow. Trade disruptions from protectionist policies and inflationary pressure from global conflicts could also lower demand for Namibia’s exports.
It said declining SACU and diamond revenues may increase debt risks and could force the government to ration spending to protect fiscal space. Global growth is also expected to slow. The IMF projects world GDP to fall from 3.3% in 2024 to 3.2% in 2025 and to 3.1% in 2026. The IMF links the drop to protectionist measures and rising uncertainty, though the tariff impact is smaller than first expected.
Sub-Saharan Africa’s growth is expected to hold at 4.1% in 2025, unchanged from 2024, before rising to 4.4% in 2026 as weather shocks ease and supply constraints improve.
Caption
Mining activities at Swakop Uranium’s Husab Mine. Mining is expected to play a big role as economic growth regains momentum in 2026.
- Photo: Chamber of Mines of Namibia
