Chamwe Kaira
Minister of Finance Ericah Shafudah tabled Namibia’s N$87.9 billion national budget for the 2026/27 financial year in Parliament on Thursday under the theme “People, Productivity and Prudence”.
The total budget, excluding statutory payments, amounts to N$87.9 billion under the Medium-Term Expenditure Framework.
Shafudah said the budget focuses on macroeconomic stability, debt sustainability and value for money while protecting key social and economic investments.
She said the plan seeks to restore balance in public finances.
“The choices before us are difficult, but they are necessary,” she said.
The overall budget deficit is projected to decline to 5.5% of GDP in 2026/27. It is expected to narrow to 3.8% in 2027/28 and 3.3% in 2028/29.
Shafudah said Namibia faces limited fiscal space, high public debt and a slow recovery. Economic growth is projected at 3.1% in 2026 and is expected to average about 3.3% over the medium term. Inflation is forecast to average around 3.5% this year.
Revenue for 2026/27 is projected at N$89.8 billion, up 2.5% from the revised N$87.4 billion for 2025/26. The increase is driven mainly by higher Southern African Customs Union receipts, expected to rise to N$24.3 billion from N$21.8 billion.
Fiscal pressure remains, especially in the mining sector. Gold output is declining as operations shift to underground mining and lower-grade ore.
The government’s total financing requirement will peak at N$19.2 billion in 2026/27 before easing over the medium term.
Public debt stood at N$174.6 billion, or 65.2% of GDP, in January 2026. It is projected to rise to N$217.3 billion by 2028/29 and stabilise at about 67.5% of GDP. Interest payments will increase from N$14.3 billion in 2025/26 to N$16.2 billion in 2026/27. This will consume 18.1% of total revenue.
Shafudah said government aims to restore a positive primary balance during the MTEF period and gradually move the debt-to-GDP ratio toward the Southern African Development Community benchmark of 60%.
Total expenditure for 2026/27 includes N$81.3 billion for operations and N$6.5 billion for development projects funded by the state. A further N$4 billion is expected from external grants and loans for infrastructure.
The social sector remains the largest share of spending at N$54.3 billion, or 61.7% of total expenditure excluding interest payments.
Education receives N$28 billion. This includes N$2.8 billion for subsidised tertiary education and efforts to reduce congestion in schools. Over three years, N$83.6 billion will go to education and youth development.
The Ministry of Health and Social Services is allocated N$13.1 billion, including N$259 million to recruit health professionals. Over the MTEF, the ministry will receive N$38.5 billion to upgrade hospitals and clinics.
Safety and security receive N$17 billion, representing 19.5% of total spending excluding interest. This includes N$7.5 billion for defence and N$8.1 billion for home affairs, immigration, safety and security to recruit correctional officers and police cadets.
Government has set aside N$1.7 billion to improve civil servants’ pay. Employees in grades 15 and 14 will receive a N$700 monthly increase. Those in grades 13 to 11 will receive a 5% increase from April 2026. Another 5% increase is planned for 2027/28.
Other allocations include N$78 million to address shortages of judges and magistrates, N$108 million for correctional services recruitment and N$58 million to improve remuneration for public office bearers.
The transport vote receives N$2.1 billion from the State Revenue Fund. It will be supported by N$1.6 billion in external loans and grants and N$2.4 billion from the fuel levy through the Road Fund Administration.
The Ministry of Agriculture and Land Reform receives N$1.8 billion. Water and Marine Resources is allocated N$1 billion, with external support for rural water supply and water infrastructure.
The National Housing Enterprise has secured N$1.5 billion in loan financing over the MTEF to build about 2 300 houses.
Fuel levy revenue will continue to fund priority road projects through the Road Fund Administration.
Shafudah also outlined tax reforms over the medium term. These include adjustments to personal income tax brackets, a review of depreciation allowances, modernisation of VAT legislation and the introduction of e-invoicing.
The Income Tax Amendment Bill and Public Finance Management Bill are set for tabling in 2026. The Special Economic Zones Bill is expected before the end of the year.
