WINDHOEK, Aug. 11 (Xinhua) -- Namibia's economy is projected to grow by 3.5 percent in 2025, down from 3.7 percent in 2024, due to weaker performance in agriculture, mining and manufacturing, the central bank said in its latest economic outlook released on Monday.
In its August Economic Outlook report, the Bank of Namibia (BoN) said the deceleration is mainly attributed to a contraction in primary industries, particularly the livestock sub-sector, stemming from reduced herd sizes, which continue to be impacted by the drought conditions experienced in 2024.
Additionally, BoN said the diamond mining sector is expected to continue its declining path, reflecting weak global demand coupled with headwinds from the imposition of trade tariffs and rising competition from lab-grown alternatives.
It noted that the manufacturing sector is also set to weigh negatively on growth, with notable contractions anticipated in meat processing and basic non-ferrous metals.
According to the bank, growth is, however, estimated to recover to 3.9 percent in 2026, supported by a rebound in agriculture, continued strength in construction, and improved output in uranium and metal ores.
Downside risks include a potential reduction in diamond export earnings, trade disruptions linked to protectionist policies, and inflationary pressures from global conflicts.
Lower revenues from the Southern African Customs Union and diamond sales could increase debt sustainability risks, possibly requiring expenditure cuts to safeguard fiscal stability, the report warns.
