Namibias Challenging Outlook: Hidden export potential

A Rand Merchant Bank (RMB) report has found that Namibia has an untapped export potential of approximately 62 billion Namibia-Dollar (3.2 billion US-Dollar) in earnings that are currently not being realised. As a percentage of gross domestic product (GDP), this represents a staggering 29 Percent of Namibia’s GDP, the investment and corporate banker noted.





RMB explained that Namibia finds itself in a difficult position: low investment levels and high current account deficits have limited the country’s growth momentum, despite its considerable export potential. A comparative study by RMB revealed that Namibia has a gross capital formation of just 20% of GDP, combined with a current account deficit of 10 to 12%.





According to the report, while global attention focuses on exports to the United States, the majority of export potential for the 31 African countries studied lies outside the US. For Namibia, untapped export potential to the US alone stands at N$1.68 billion (US$97 million). Despite the challenging outlook, RMB highlighted that potential investments in oil and gas could propel economic growth close to 10%. RMB also noted Namibia’s inherent constraints on growth, including water scarcity and a small population. Read more on this topic in our Market Watch Edition.