By Nyasha Nyaungwa
WINDHOEK (Reuters) – Namibia has lowered its economic growth forecast for this year, Finance Minister Iipumbu Shiimi said on Wednesday, citing a slump in demand for diamonds and a severe drought.
Its economy is expected to grow 3.6% this year, compared to a February forecast for 4.0% growth, Shiimi told parliament in a mid-year budget review.
Arid Namibia is among a handful of southern African countries to have suffered the worst drought in the region in decades.
“The revisions stem primarily from expected lower output from the mining and agriculture sectors which have been negatively affected by low global demand for diamonds as well as the ongoing drought,” Shiimi said.
Namibia’s overall budget deficit is still seen at 3.2% of gross domestic product in the fiscal year that runs to the end of March 2025, the same projection given in February’s budget.
Shiimi said weak global demand for commodities remained an important near-term risk to the growth outlook.
He said it was imperative for drought-prone Namibia to invest in climate-resilient infrastructure projects and implement climate change mitigation and adaptation policies.
(Reporting by Nyasha Nyaungwa; Writing by Bhargav Acharya; Editing by Alexander Winning and Barbara Lewis)
