The Bank of Namibia projects a slowdown in uranium mining sector growth to 3.6% in 2024 from a robust 24.5% in 2023, attributed to water supply interruptions and mine adjustments.
Despite the uranium price surge in the past months as anticipated by market analysts since 2013, water supply interruptions and production adjustments at mines are still expected to hinder output.
“Despite increased spot prices, the sector is expected to experience water supply interruptions, resulting in uranium mines adjusting their production downwards, coupled with anticipated stripping activities at some of the mines,” said BoN’s Economic Outlook Update for March 2024.
Furthermore, Metal ores growth is projected to decrease by 3.5% in 2024 and 0.6 %in 2025, following a robust 33.7% growth in 2023, primarily due to a reduction in gold production.
“The expected contraction in 2024 and 2025 is mainly on account of depletion of ores from the gold sub-sector. The latest projections reflect a downward revision of 11.1% in 2024 and 4.4% in 2025,” said BoN.
The latest growth forecast reflects an upward revision of 0.6% and 7.8% for 2024 and 2025 compared to the December 2023 Economic Outlook update.
This comes as BoN estimates that Real GDP growth will slow down to 3.7% in 2024 before improving slightly to 4.1% in 2025.
“The projected slowdown in 2024 is largely on account of weaker global demand, and slower growth in the primary industry, particularly in the mining sector,” noted BoN.
Meanwhile, Growth in Agriculture, forestry and fishing is expected to remain low in 2024, largely due to the effects of the drought.
Similarly, the diamond mining sector is expected to register lower growth rates during the forecast horizon, mainly due to high base effects.
“The diamond mining sector is expected to slow to 2.1% growth in 2024 before rebounding to 5.7 % in 2025. The anticipated significant slowdown in diamond mining is attributed to low production on the back of unfavourable international prices coupled with subdued global demand for rough diamonds,” noted BoN.
On the other hand, the central bank highlights that government-dependent sectors such as public administration & defence, education, and health are poised for growth due to an expansionary fiscal policy stance.
Additionally, the construction sector is anticipated to resume growth from 2024 onwards.-miningandenergy.com.na
