Namibia’s economy is expected to grow more slowly in 2025, with real GDP growth projected to ease to 3.0%, down from an estimated 3.7% in 2024, according to the Bank of Namibia’s December 2025 Economic Outlook Update.
The Bank said the weaker outlook reflects subdued performance across several key sectors, led by a contraction in manufacturing and continued softness in primary industries.
Drought-related losses in agriculture and declining diamond output remain major drags on growth.
Persistent drought conditions and weak global demand are also cited as significant contributors to the softer economic prospects.
The manufacturing sector is forecast to contract by 4.6% in 2025, reversing the 2.8% growth recorded in 2024.
The report attributes the downturn mainly to steep declines in basic non-ferrous metals, meat processing and diamond processing.
Basic non-ferrous metals are expected to fall by 58.5%, reflecting lower copper processing volumes and muted international demand. Meat processing is projected to decline by 26.5% as farmers rebuild herds after significant destocking during the 2024 drought.
Primary industries are likewise expected to remain under pressure. The agriculture, forestry and fishing sector is projected to shrink by 4.2% in 2025, following a 2.7% contraction in 2024. Livestock farming is forecast to decline sharply by 22.5% due to depleted herd sizes and limited feed availability. The fishing subsector is expected to contract by 4.7% as lower catch volumes persist.
Despite these challenges, the Bank projects a rebound in the medium term, with growth expected to rise to 3.8% in 2026 and 4.3% in 2027.
The recovery is anticipated to be driven by improved rainfall, stronger performance in construction and electricity generation, and higher uranium output.
“Growth is projected to recover to 3.8% in 2026 and further to 4.3% in 2027, supported by improvements in agriculture, construction, electricity generation and uranium mining,” the Bank noted.
Tertiary industries are expected to remain resilient, with overall growth of 4.5% projected for 2025. Wholesale and retail trade is forecast to expand by 6.2%, supported by activity in construction, mining supply chains and oil and gas appraisal work.
Transport and storage is expected to grow by 4.2%, public administration by 3.7%, and the health sector by 5.6%.
However, the Bank cautioned that the outlook is subject to significant downside risks. Declining diamond export earnings, rising global protectionism and inflationary pressures linked to geopolitical conflicts could dampen demand for Namibia’s exports.
The report also warns that falling SACU and diamond revenues could heighten debt sustainability risks and may necessitate fiscal tightening.
