…as debt rises above 70% of GDP
Namibia’s economy is expected to grow by just 1.9% in 2026, less than half the Sub-Saharan African average, as rising public debt and a widening fiscal deficit continue to constrain the government’s fiscal space, the World Bank says.
According to the World Bank’s latest Africa Economic Update: Building AI Readiness, Namibia’s projected growth trails the 4.3% forecast for Sub-Saharan Africa in 2026.
The country’s economic growth slowed from 3.8% in 2024 to an estimated 1.7% in 2025 and is expected to recover gradually to 2.9% in 2027 and 3.8% in 2028.
The projections place Namibia below its pre-pandemic average growth rate of 3.1% recorded between 2010 and 2019 until at least 2028.
Namibia’s fiscal position is also expected to remain under pressure, with the general government deficit estimated at 6.5% of GDP in 2026, unchanged from 2025 and significantly wider than the 4.0% recorded in 2024.
The World Bank expects the deficit to narrow to 5.0% of GDP in 2027 and 3.7% in 2028.
Government debt is projected to increase from 67.5% of GDP in 2025 to 70.8% in 2026 before rising further to 71.2% in 2027.
Debt is expected to ease marginally to 70% of GDP in 2028, remaining substantially above Namibia’s average debt-to-GDP ratio of 38.9% between 2010 and 2019.
The World Bank classifies Namibia as an IBRD/blend country, with bonds accounting for a significant share of external public and publicly guaranteed debt.
The report warned that market-based borrowing can expose economies to higher refinancing risks due to commercial interest rates, shorter maturities and dispersed creditors.
Namibia is, however, not among Sub-Saharan Africa’s largest sovereign Eurobond issuers or countries facing the region’s biggest bond redemption schedules.
Inflation is meanwhile expected to increase from 3.5% in 2025 to 4.1% in 2026 and 4.3% in 2027 before easing back to 3.5% in 2028.
The World Bank said Namibia’s policy rate stood at 6.75% following a 25-basis-point increase in 2026 and had remained unchanged for three months.
The move followed monetary tightening in South Africa, which raised its policy rate by a cumulative 50 basis points through increases in May and September.
Namibia’s dollar, which is pegged one-to-one to the South African rand, also weakened during the March-to-June period amid the 2026 Middle East crisis.
However, stronger demand for gold and platinum supported the rand and indirectly provided some support to the Namibia dollar.
The World Bank said Namibia, as a mineral and metal exporter, could benefit from stronger commodity export receipts, helping reduce pressure on its current account compared with 2023.
The government also intervened to cushion consumers from the global energy shock during 2026 by cutting fuel levies and absorbing part of the increase in fuel prices through the National Energy Fund.
The report noted, however, that limited fiscal buffers across Sub-Saharan Africa have constrained governments’ ability to sustain broad fuel subsidies and tax reductions.
Namibia is also developing a draft National Nuclear Energy Policy as part of longer-term efforts around its energy sector.
