Depressed uranium prices,COVID-19 threaten domestic growth prospects

The Bank of Namibia (BoN) in its August Economic Outlook 2021 says COVID-19, depressed uranium prices and water supply interruptions to mines at the coast, are some of the threats to the domestic economy which is forecasted to grow by 1.4% this year.

The Bank of Namibia (BoN) in its August Economic Outlook 2021 says COVID-19, depressed uranium prices and water supply interruptions to mines at the coast, are some of the threats to the domestic economy which is forecasted to grow by 1.4% this year.

It represents a downward revision from the 2.7% announced in the February 2021 Economic Outlook update.

“Risks to domestic growth includes new waves of the COVID-19 pandemic, the pace of vaccination roll-outs in Namibia, low international prices for uranium and the potential effects of the recent political unrests in South Africa. Water supply interruptions that affected mining production at the coast have become less severe but remain a significant risk going forward.”

The central bank has forecasted further growth in 2022 on the back of growth prospects in the mining sector and recovery for some industries in the tertiary sector.

“Domestic growth is expected to recover moderately during 2021, before accelerating in 2022, from a contraction in 2020. Domestic growth is projected to increase to 1.4% and 3.4% in 2021 and 2022, respectively, from a contraction of 8% in 2020,” the central bank said.

“A significant downward revision was made on growth for diamond mining based on revised output targets by the industry. Other major downward revisions to growth between February 2021 and August 2021 were made for all secondary industries. In general, the revised lower economic growth is largely attributed to new variants of the Coronavirus, vaccination hesitancy and slow vaccination rates in Namibia that were not expected during the February 2021 update.”

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Last modified on Monday, 06 September 2021 12:59