Chamwe Kaira
The government is considering issuing a new Eurobond or seeking a syndicated facility in 2026. However, analysts have urged caution due to the country’s heavy exposure to US dollar- and euro-denominated debt and the ongoing volatility in global bond markets.
Simonis Storm Securities warned that any new issuance should be carefully timed and backed by a clear fiscal consolidation plan. “Investor appetite will not be guaranteed, and we’ve seen risk premiums widen fast across similarly rated sovereigns,” the firm said.
Namibia has increased its reliance on the domestic bond market in recent years. In the 2020/21 financial year, local borrowing made up about 60% of total funding needs. By 2025/26, that figure has risen to over 71%.
“This is not incidental. It reflects rising debt obligations, constrained access to concessional capital, and the high cost of foreign funding in a globally volatile rate environment. Domestic markets have become the core engine of Namibia’s fiscal operations,” Simonis said.
In 2023/24, total gross borrowing stood at N$10.1 billion, with N$7.4 billion (73%) raised locally. The government focused on mid-curve fixed-rate bonds, including GC28, GC32, GC35, and GC40, to manage liquidity while meeting investor demand.
In 2024/25, borrowing needs increased to N$15.3 billion, with N$12.8 billion, nearly 84%, raised on the domestic market. For 2025/26, domestic borrowing is expected to reach N$21.2 billion, the highest on record.
“GC35 to GC50 completely dominate the auction calendar. The strategy is clear: reduce rollover risk, extend average maturity, and stabilise the debt profile. But every benefit comes with a cost,” the firm said.
Simonis noted signs of absorption fatigue in the local market. Institutional investors like pension funds, insurers, and commercial banks are becoming saturated with government securities.
On the external front, concessional funding remains limited. Namibia raised about N$2.7 billion in 2023/24 from sources like the African Development Bank and KfW.
In 2024/25, the figure was N$2.4 billion. But in 2025/26, foreign borrowing will increase to N$8.6 billion.
This rise is largely due to the US$750 million Eurobond issued in 2015, which matures in October 2025. The government has built a US$463 million sinking fund and plans to add N$3 billion (about US$160 million) this year. However, a funding gap of US$125 to US$150 million remains.
“How the deficit is covered will matter. Drawing reserves in a weak currency environment could significantly increase the foreign exchange risk. If the state seeks short-term external refinancing, pricing will depend heavily on Namibia’s rating, capital market sentiment, and the global yield curve in early 2026. Either way, this Eurobond is not just a debt maturity. It’s a stress test for Namibia’s external liquidity framework,” Simonis said.
