Chamwe Kaira
Namibia is on target to redeem the US$750 million eurobond when it matures in October, according to Nicholas Mukasa, director of financial markets at the Bank of Namibia.
“As far as the Eurobond redemption is concerned, all I can say is that we are on target to redeem that bond when it matures in October,” Mukasa said.
In her budget speech in March, minister of finance Ericah Shafudah said the 2025/26 financial year would be eventful, with the government facing the redemption of the eurobond on 29 October.
By March, the government had accumulated US$463 million in the sinking fund over previous financial years.
The plan is to add another N$3 billion (US$162 million) to the fund in the 2025/26 financial year before the bond matures, leaving a balance of N$2.3 billion (US$125 million) to be refinanced through the domestic market.
Mukasa said Namibia has a detailed sovereign debt management strategy that the central bank is following.
“As we have been mentioning, we have a sinking fund with some savings that go towards redeeming this bond. And also, as part of this year’s borrowing plan, you have seen that there has been a pick-up in the domestic issuances, part of that to make a way for funding to be able to redeem that bond. So as far as that borrowing plan is concerned, it is performing well; there are no funding shortfalls. We have seen very good interest in both of our bonds, both short and long-term bonds. So we are basically on target,” he said.
The government is also making principal repayments on the IMF Rapid Financial Instrument, amounting to N$2.3 billion in the 2025/26 financial year and the final tranche of N$1.2 billion in FY2026/27, along with periodic redemptions of domestic bonds.
Public debt is expected to decline from 66% of GDP in FY2024/25 to 62% in FY2025/26. After settling the Eurobond and IMF obligations, over 80% of the country’s debt will be in domestic currency, reducing exposure to exchange rate risks.
