Consumer, construction stuck in recession

Strong growth in mining last year saved the economy from sinking deeper into a recession.

29 March 2019 | Economics

Consumers remain wary of spending as real disposable income is being eroded. – Namibia Statistics Agency

Wholesale and retail trade, the heavyweight in the local economy, in 2018 spent its second year in a full-blown recession, recording negative growth of 7.2%.

Data released by the Namibia Statistics Agency (NSA) yesterday, shows the sector also experienced a worse contraction in 2017 than previously thought, registering revised growth of -7.9% instead -7.5%.

Overall, the Namibian economy grew by -0.1% in 2018 compared to -0.9% the previous year.

According to the NSA, the slow performance in wholesale and retail trade was reflected in the sales of vehicles and furniture's that contracted by 11.8% and 8.4% respectively. Supermarkets and wholesaler sales slowed to 0.7% and 4.7%.

“Consumers remain wary of spending as real disposable income is being eroded,” the NSA said.

Public administration and defence - which include central government administrative activities, statutory bodies and local government activities - recorded a slow positive growth in real value added of 0.4% in 2018 compared to a growth of 0.3% recorded in 2017.

“The subsector central government administration recorded a contraction of 2% in real value added in 2018 compared to 2.4% in 2017,” the agency said.


The construction sector recorded negative growth in real value added of 18.3% during the period under review compared to a negative growth of 25% recorded in 2017. Last year marked three consecutive years of recession for the sector.

The NSA said the poor performance was mainly due to construction works done by the government and mining sectors that recorded declines of 23.4% and 46.3% in real terms in 2018 compared to declines of 29.6% and 68.6% recorded in 2017 respectively.

“However, the value of buildings completed, in nominal terms, registered a slow growth of 10.2% in 2018 compared to a strong growth of 35.5% recorded in the preceding year.

Agriculture, fishing

During the period under review, the agriculture and forestry sector recorded a contraction of 2.2% in real value added relative to a strong growth of 14.3% recorded in 2017.

“The poor performance in the sector is underpinned by the livestock subsector that registered a decline of 12.2% in contrast to a robust growth of 12.5% in real value added registered in 2017,” the NSA said.

Activities in the livestock subsector declined during 2018. “This performance is predominantly driven by a prolonged reduction in the availability of marketable livestock (large & small stock) resulting from understocking of herds.”

According to the NSA, the crop farming and forestry subsector registered a moderate growth of 10.6% in real value added relative to a strong growth of 16.9% recorded in 2017.

“Growth in the subsector is attributed to strong growths in the overall production of grapes and mahangu. This is subsequent to the passable, although late rainfalls received during 2018,” the NSA said.

The fishing and fish processing on board sector recorded a positive growth of 3% during 2018 compared to 1.3% registered in 2017.

Mining, others

The mining and quarrying sector is estimated to have registered a strong growth of 22% in real value added during 2018, compared to 13.3% recorded in 2017.

“The performance in the sector is attributed to diamond, uranium and other mining and quarrying subsectors that recorded strong growths of 13.7%, 64.8% and 54.1%, respectively.”

The manufacturing sector is estimated to have recorded a slow growth of 0.2% in real value added in 2018 compared to a growth of 1.9% recorded in 2017.

The hotels and restaurants sector recorded consecutive declines in real value added of 9.4% in 2018 compared to 1.9% registered in 2017.

“The performance in the sector is mainly attributed to subsector restaurants' that registered decline in real value added of 11.9% in 2018 compared to a growth of 0.5% recorded in 2017. The subsector hotels also registered declines in real value added of 8.1% in 2018 compared to 3% in 2017 respectively,” the NSA said.

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