Business Monitor International


Namibia Business Forecast Report

Published 16 December 2014

  • 45 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
 
$1,195.00
Namibia Business Forecast Report

Core Views:

  • Strong domestic demand and accelerating investment in the mining sector will see economic growth in Namibia average a respectable 4.5% annually over the next five years. Over the near term, export performance will continue to be weighed down by weak global demand and soft commodity prices.

  • We expect the ruling SWAPO to secure a comfortable victory in November's general elections, with the party likely to maintain its broadly pro-business economic agenda in the years ahead. A weak and under-funded opposition will preclude anything other than a minor swing away from the ruling party.

  • Our broad outlook for Namibia's current account over the next few years remains relatively unchanged. We maintain that the country will sustain a sizeable current account shortfall over our 2014-2018 forecast period as demand for imports associated with new mining projects more than offsets a sluggish recovery in demand for key mineral exports.

Major Forecast Changes:

  • No major forecast changes

Key Risks To Outlook:

  • Namibia's small, open economy is highly exposed to events on the world stage. While we have incorporated the ongoing global malaise into our economic forecasts, if the situation abroad deteriorates (or, conversely, improves) more than we anticipate, we would have to adjust our forecasts accordingly.

  • Much of the economy remains closely tied to agriculture, and weather poses substantial risks, as illustrated by the ongoing drought which has threatened yields and food security. Changing weather conditions pose both upside and downside risks to a number of our forecasts, including for growth, inflation, and trade.

Forecast Table: 

Macroeconomic Forecasts (Namibia 2012-2018)
Indicator 2012 2013e 2014f 2015f 2016f 2017f 2018f
Nominal GDP, USDbn 13.4 12.6 12.1 14.0 15.8 16.9 18.2
Real GDP growth, % y-o-y 5.0 4.3 4.5 4.5 4.4 4.6 4.6
Consumer price...

Table of Contents

Executive Summary
5
Core Views
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Domestic Politics
8
Landslide Win Gives Geingob A Strong Mandate
8
The landslide victory for president-elect Hage Geingob and the ruling SWAPO in Namibia's general elections on November 28 augurs
The landslide victory for president-elect Hage Geingob and the ruling SWAPO in Namibia's general elections on November 28 augurs
for broad political stability and a pro-business economic agenda
Hopes for a shift towards a more inclusive electoral landscape continue
to prove elusive
Tab le: Politica l Overview
8
Long-Term Political Outlook
10
Stability Likely To Prevail Over The Coming Decade
10
While Namibia's enormous income inequality poses some risks to political stability, we believe the population is likely to continue
While Namibia's enormous income inequality poses some risks to political stability, we believe the population is likely to continue
supporting the South West Africa People's Organization (SWAPO) government for the next 10 years, ensuring broad political stability
supporting the South West Africa People's Organization (SWAPO) government for the next 10 years, ensuring broad political stability
and continuity
Chapter 2: Economic Outlook
13
SWOT Analysis
13
BMI Economic Risk Index
13
Economic Activity
14
Investment-Powered Growth Ahead
14
The Namibian economy will post solid growth of 4
Growth will be driven in the main by capitalintensive
investment projects in the mining and infrastructure space, while key exports such as diamonds and uranium will benefit from
investment projects in the mining and infrastructure space, while key exports such as diamonds and uranium will benefit from
gradually improving demand conditions in key markets
Table: Economic Activity
14
Balance Of Payments
15
Lower Oil Prices Provide C/A Support
15
Namibia will sustain a sizeable current account deficit in the range of 4
0% of GDP over the next five years, due to a structural
dependence on capital and consumer goods imports
Table: Current Account
16
Monetary Policy
17
Rate Hold Reflects Shift In Balance Of Risks
17
Renewed global economic uncertainty, a benign inflation outlook and the Bank of Namibia's (BoN) close adherence to monetary policy
Renewed global economic uncertainty, a benign inflation outlook and the Bank of Namibia's (BoN) close adherence to monetary policy
in neighbouring South Africa will see Namibia's benchmark interest kept steady at 6
Table: Monetary Policy
18
Fiscal Policy
18
Fiscal Deficit To Remain Sizeable
18
Namibia's fiscal balance will deteriorate modestly through FY2014/15 to reach the equivalent of 4
An expansionary budget
and election-related pressures will keep spending high, while we are less optimistic than the authorities in our outlook for the economy,
and election-related pressures will keep spending high, while we are less optimistic than the authorities in our outlook for the economy,
and by extension revenue generation, over the coming quarters
Table: Fiscal Policy
19
Chapter 3: 10-Year Forecast
21
The Namibian Economy To 2023
21
Resource Powered Growth
21
Thanks to the country's strong primary sector, we expect growth to prove relatively robust in th e long run, averaging around 4
5 %
annually over 2014 to 2023
With a stable political environment, the main risks are the limited size of the domestic market, rising income
inequality and global demand for the country's primary exports
Table: Long-Term Macroeconomic Forecasts
21
Chapter 4: Operational Risk
23
SWOT Analysis
23
Operational Risk Index
23
Operational Risk
24
Table: Operational Risk
24
Transport Network
25
Tab le: SSA Transport Network Risks
26
Economic Openness
29
Tab le: Sub -Saharan Africa - Economic Openness
30
Table: Top 5 Products Exported
32
Table: Top 5 Trade Partners Product Imports
33
Chapter 5: Key Sectors
35
Infrastructure
35
Table: Construction And Infrastructure Industry Data
36
Table: Construction And Infrastructure Industry Data
37
Other Key Sectors
41
tab le: Pharma Sector Key Indicators
41
table: Telecoms Sector Key Indicators
41
table: Food and Drink Sector Key Indicators
42
table: Autos Sector Key Indicators
42
Chapter 6: BMI Global Assumptions
43
Global Outlook
43
Warning Signs Growing
43
Table: Global Assumptions
43
Table: Developed States, Real GDP Growth, %
44
Table: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORE CASTS, %
44
Table: Emerging Markets , Real GDP Growth , %
45

The Namibia Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in The Namibia and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market..

An influential new analysis of The Namibia's economic, political and financial prospects through end-2017, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

  • Forecast the pace and stability of The Namibia's economic and industry growth through end-2017.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise The Namibia's country risks against regional peers using BMI's country comparative Risk Ratings system.
  • Evaluate external threats to doing business inThe Namibia, including currency volatility, the commodity price boom and protectionist policies.

The Namibia Business Forecast Report by Business Monitor International (BMI) includes three major sections: Economic Outlook, Political Outlook and Business Environment.

Economic Outlook:

How will the Namibian economic policy-making and performance impact on corporate profitability over 2013-2017?

BMI provides our fully independent 5-year forecasts for The Namibia through end-2017 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Namibia Business Forecast Report features BMI's forecasts with supporting analysis for 2013 through to end-2017, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Ratings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector exposure).
  • Global Assumptions - forecasts for each year to end-2017 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for The Namibia and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on The Namibia, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in The Namibia over the next 5-years?

BMI's The Namibia country Risk Ratings evaluate the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the The Namibian Market - Political Strengths, Weaknesses, Opportunities and Threats facing The Namibia.
  • Political Stability and Risk Assessment - BMI's Risk Ratings assess explicit short- and long-term risks to political stability; latest ratings, rankings and trends for The Namibia's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.

Key Benefits

  • Benchmark The Namibia's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Business Environment

Business Environment Risk Ratings with SWOT Analysis - Business environment Risk Ratings for The Namibia, benchmarked against ratings for regional neighbours.

Country Competitiveness - Competitiveness of The Namibia's business operating environment in supporting corporate growth and profitability, compared with regional neighbours.

Business Environment Contents

  • Domestic Environment - Transparency, cronyism and corruption; labour market flexibility; corporate tax burden; interest rate levels; sophistication of banking sector and stock market; levels of business confidence; infrastructure and IT.
  • Foreign Direct Investment - Analysis of foreign investment regime; foreign ownership laws; attractiveness of business environment to foreign investors.
  • Foreign Trade - Analysis of trading environment, government trade policy, liberalisation measures, tariffs and membership of trade areas.

Key Benefits

  • Assess your company's evolving exposure to country specific operational and business risks, using BMI's in-depth analysis of the legal and regulatory business environment.
  • Understand your market's comparative strengths and weaknesses in the key areas of commercial infrastructure and business institutions, using BMI's proprietary global Business Environment Risk Ratings.

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Testimonials

The sections that I find most interesting and useful are the macroeconomic data and forecasts for the country, top export destinations and economic activity. The indicators/analysis of these areas helps us orient our thinking, our assumptions and, consequently, our decisions in the commercial area.

Country Manager, DHL Express