Economy contracts 2.7%
Economic growth contracted in the first quarter of 2017, with the construction and manufacturing sectors hit hard.
Economic growth contracted in the first quarter by 2.7% according to the Namibia Statistics Agency, which released trade data last week.
Weaknesses were more noticeable in the construction and manufacturing sectors the NSA said, while some strengths were found in the banking, fisheries and communication sectors.
“The poor performance can mainly attributed to the construction, manufacturing, wholesale and retail trade and hotels and restaurants sectors that contracted by 44.9%, 10.7%, 7.4% and 9.3% in real value added, respectively,” the NSA said.
“Slower growths were observed in sectors such as financial intermediation, transport and communications and fishing sectors that registered 0.1%, 0.7% and 4.6% in real value added, respectively.”
In contrast to the slow growth, sectors such as agriculture, mining and quarrying recorded double digit growth of 10.5% and 16.8% compared to the contractions recorded in the corresponding period, the NSA has found.
“The water and electricity sector also posted strong growths of 6.1% compared a marginal growth of 0.3% in real value added registered in the same quarter of 2016,” the NSA said.
Namibia Equity Brokers analyst Ngoni Bopoto said the trade data reflected an extremely challenging fiscal year.
“The data is broadly in line with our expectation and reflects the sentiment on the ground given that the period under review was the last of an extremely challenging fiscal year.”
Bopoto also said that recoveries in diamond mining and agriculture would bolster growth, in the face of threats to economic growth.
“We remain of the opinion that while the outlook is precarious for the second quarter of 2017 numbers will most likely show an improvement aided by renewed focus in the new fiscal year, continued recovery in diamond mining and agriculture, prospects of improved Southern African Customs Union receipt,” said Bopoto.
PSG Konsult analyst Michele Arnold expected an improvement in trade conditions, mostly on account of stronger commodity prices.
We expect the trade deficit will narrow slightly during the rest of 2017 as commodity prices recover somewhat thanks to a moderate uptick in global demand, while local demand for imports related to infrastructure spending,” said Arnold.
OGONE TLHAGE
Weaknesses were more noticeable in the construction and manufacturing sectors the NSA said, while some strengths were found in the banking, fisheries and communication sectors.
“The poor performance can mainly attributed to the construction, manufacturing, wholesale and retail trade and hotels and restaurants sectors that contracted by 44.9%, 10.7%, 7.4% and 9.3% in real value added, respectively,” the NSA said.
“Slower growths were observed in sectors such as financial intermediation, transport and communications and fishing sectors that registered 0.1%, 0.7% and 4.6% in real value added, respectively.”
In contrast to the slow growth, sectors such as agriculture, mining and quarrying recorded double digit growth of 10.5% and 16.8% compared to the contractions recorded in the corresponding period, the NSA has found.
“The water and electricity sector also posted strong growths of 6.1% compared a marginal growth of 0.3% in real value added registered in the same quarter of 2016,” the NSA said.
Namibia Equity Brokers analyst Ngoni Bopoto said the trade data reflected an extremely challenging fiscal year.
“The data is broadly in line with our expectation and reflects the sentiment on the ground given that the period under review was the last of an extremely challenging fiscal year.”
Bopoto also said that recoveries in diamond mining and agriculture would bolster growth, in the face of threats to economic growth.
“We remain of the opinion that while the outlook is precarious for the second quarter of 2017 numbers will most likely show an improvement aided by renewed focus in the new fiscal year, continued recovery in diamond mining and agriculture, prospects of improved Southern African Customs Union receipt,” said Bopoto.
PSG Konsult analyst Michele Arnold expected an improvement in trade conditions, mostly on account of stronger commodity prices.
We expect the trade deficit will narrow slightly during the rest of 2017 as commodity prices recover somewhat thanks to a moderate uptick in global demand, while local demand for imports related to infrastructure spending,” said Arnold.
OGONE TLHAGE
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