IMF expects higher deficit than Calle
The IMF expects a deficit of 4.8% of GDP in the current fiscal year compared to the finance minister’s 3.6%.
Jo-Maré Duddy – If the International Monetary Fund has hit the mark with its latest forecast, finance minister Calle Schlettwein’s deficit targets set in his budget are in danger.
When he tabled the 2017/18 Main Budget in March, Schlettwein aimed for a deficit of 3.6% of gross domestic product (GDP) in the current fiscal year. Next year he wants to reduce the deficit to 2.5% of GDP.
In its Regional Outlook released yesterday, the IMF expects a deficit of 4.8% for 2017/18. In 2018/19 it will shoot up to 6% of GDP, the Fund forecasts.
Schlettwein is expected to table his mid-year budget review this week. This will indicate how reliable the IMF’s crystal ball is.
The IMF and Schlettwein are on par as far as their estimation for total government debt is concerned. Schlettwein’s main budget targeted 41.9% for 2017/18, while the IMF expects 41.5%. However, the two parties differ on the levels for 2018/19. Schlettwein’s target is 40.1% of GDP, while the IMF forecasts 43.6%.
Peers
Namibia’s debt burden for the current fiscal year compares favourably with the rest of region, according to the IMF’s latest forecast.
The average for government debt in Sub-Saharan Africa (SSA) is 45.1% of GDP. For the Southern African Customs Union (Sacu), the average is 50.7%. The figure for the Southern African Development Community (SADC) is 51.8%.
As far as deficits are concerned, Namibia is slightly below the averages. The average deficit forecast in SSA is 4.7% of GDP, the same as that of SADC. For Sacu an average of 4.3% is expected.
Namibia compares far less favourably when it comes to the IMF’s forecasts for government expenditure. For the current budget year, the Fund expects Namibia’s government expenditure to be 37% of GDP.
The average for SSA is 22.3%, while that of SADC is 28.7%. For Sacu an average of 33.7% is forecast.
The IMF estimates that government income in Namibia will amount to 32.1% of GDP in 2017/18. The Fund’s average for SSA is 17%, while it expects 23.6% for SADC and 29.4% for Sacu.
Economic growth
Namibia’s economy is expected to grow by 0.8% this year, according to the IMF. Schlettwein recently said the government now expects the economy to grow by between 1.8% and 2.3% this year, down from the forecast of 2.5% in the main budget.
The IMF’s average growth forecast for SSA is 2.6% and for SADC it is 2.2%. For Sacu the Fund only expects GDP growth of 0.9% in 2017/18.
The IMF slashed its forecast for real per capita GDP growth in Namibia this year. In April, the Fund forecast growth of 2.6%. Now it expects zero percent growth.
Compared to that the average forecast for SSA is 0.3% and for SADC it is 0.2%. Sacu has an average forecast of -0.6% for 2017/18.
When he tabled the 2017/18 Main Budget in March, Schlettwein aimed for a deficit of 3.6% of gross domestic product (GDP) in the current fiscal year. Next year he wants to reduce the deficit to 2.5% of GDP.
In its Regional Outlook released yesterday, the IMF expects a deficit of 4.8% for 2017/18. In 2018/19 it will shoot up to 6% of GDP, the Fund forecasts.
Schlettwein is expected to table his mid-year budget review this week. This will indicate how reliable the IMF’s crystal ball is.
The IMF and Schlettwein are on par as far as their estimation for total government debt is concerned. Schlettwein’s main budget targeted 41.9% for 2017/18, while the IMF expects 41.5%. However, the two parties differ on the levels for 2018/19. Schlettwein’s target is 40.1% of GDP, while the IMF forecasts 43.6%.
Peers
Namibia’s debt burden for the current fiscal year compares favourably with the rest of region, according to the IMF’s latest forecast.
The average for government debt in Sub-Saharan Africa (SSA) is 45.1% of GDP. For the Southern African Customs Union (Sacu), the average is 50.7%. The figure for the Southern African Development Community (SADC) is 51.8%.
As far as deficits are concerned, Namibia is slightly below the averages. The average deficit forecast in SSA is 4.7% of GDP, the same as that of SADC. For Sacu an average of 4.3% is expected.
Namibia compares far less favourably when it comes to the IMF’s forecasts for government expenditure. For the current budget year, the Fund expects Namibia’s government expenditure to be 37% of GDP.
The average for SSA is 22.3%, while that of SADC is 28.7%. For Sacu an average of 33.7% is forecast.
The IMF estimates that government income in Namibia will amount to 32.1% of GDP in 2017/18. The Fund’s average for SSA is 17%, while it expects 23.6% for SADC and 29.4% for Sacu.
Economic growth
Namibia’s economy is expected to grow by 0.8% this year, according to the IMF. Schlettwein recently said the government now expects the economy to grow by between 1.8% and 2.3% this year, down from the forecast of 2.5% in the main budget.
The IMF’s average growth forecast for SSA is 2.6% and for SADC it is 2.2%. For Sacu the Fund only expects GDP growth of 0.9% in 2017/18.
The IMF slashed its forecast for real per capita GDP growth in Namibia this year. In April, the Fund forecast growth of 2.6%. Now it expects zero percent growth.
Compared to that the average forecast for SSA is 0.3% and for SADC it is 0.2%. Sacu has an average forecast of -0.6% for 2017/18.
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