The country’s total debt, which is comprised of domestic and foreign government, corporate and household debt, represents an annualised growth rate of 14.41 per cent.
“The annual growth rate for total debt has moderated to about 13 per cent over the past few months. The growth is mainly on the back of increased debt uptake in the private sector sphere. We note that government debt has increased to 30.53 billion Namibian dollars,” the Bank of Namibia said.
(READ MORE: Namibian debt increase accredited to households)
“During the same period, household debt increased from 32.89 billion Namibian dollars to 38.10 billion Namibian dollars, with the year-on-year growth rate as high as 15.81 per cent as recorded in April.”
Private sector credit extension growth (PSCE) stood at 15.88 per cent year-on-year and the total debt to GDP ratio is expected to stand at 73.63 per cent.
“The growth in PSCE is mainly attributed to both household and corporate debt which grew by 15.81 per cent and 15.99 per cent respectively. The growth is a result of monthly growth rates of 1.92 per cent and 1.72 per cent in the category of other loans and advances and mortgage loans respectively,” the bank said.
“The weak economic conditions in South Africa suggest that further monetary accommodative easing should be maintained – this suggests that the reserve bank may have to hold off any interest rate hike in the medium term. On the Namibian front, we do not anticipate an interest rate hike consideration until the fourth quarter of the year.”
(READ MORE: Namibia keeps rates steady, focuses on sectoral growth)
It added that foreign reserves edged higher to 17.48 billion Namibian dollars from 14.59 billion Namibian dollars and that the reserves are still sufficient to cover three months’ worth of imports.