CHAMWE KAIRA
The electricity and water sector is projected to expand by 13.5% in 2025 and 12.8% in 2026, representing a notable rise from the 2.3% growth observed in 2024.
The Bank of Namibia said in the December 2024 Economic Outlook update that this expected improvement in 2025 primarily stems from favourable rainfall patterns, which are anticipated to boost electricity generation, especially from the Ruacana hydropower plant.
The improvement will also be bolstered by additional solar generation from the Otjikoto Biomass and the Rosh Pinah 70 MW PV plants, the central bank said.
“Furthermore, rising reservoir levels will contribute to growth in water subsectors. The latest growth prediction for 2025 has been revised upward by 7.8 percentage points from the previous estimate released in the December 2024 Economic Outlook update.
The manufacturing sector is projected to register a growth rate of 3.7% in 2025 before improving to 4.2% in 2026.
The improvement is primarily attributable to a growth within the grain mill products subsector, driven mainly by strong domestic grain harvests, particularly maize and millet, due to improved rainfall patterns coupled with growth in non-metallic minerals products driven by increased construction activities, the central bank said.
The growth projections for the manufacturing sector have been adjusted upward by 0.2 percentage points for 2025.
The construction sector is projected to sustain its growth trajectory throughout 2025 and 2026. The construction sector is projected to grow by 13.5% in 2025 and 12.2% in 2026, building on the strong 6.4% growth recorded in 2024..
Forecasts indicate that secondary industries will expand by 6.3% and 6.4% in 2025 and 2026, respectively, following a 3% growth rate in 2024..
“This projected performance is attributed to the anticipated expansion of both public and private construction activities and improvements in the electricity and water sectors. The growth estimates for secondary industries in 2025 and 2026 have been adjusted upward by 2.1 percentage points and 1.4 percentage points, respectively,” the central bank said.
The domestic economy is projected to grow by 3.8% and 4% in 2025 and 2026, respectively, from 3.7% estimated in 2024.
“The slight recovery for 2025 will be primarily driven by anticipated improvements in the primary industry, underpinned by robust growth in crop farming and uranium production.
Furthermore, substantial expansion in the electricity and water subsector within the secondary industries is expected to provide additional support to overall economic growth,” the central bank said.
