Namibia's external debt falls by nearly N$4bn

Namibia’s gross external debt stock declined by 2.1% year-on-year to N$180.9 billion at the end of the first quarter of 2026, from about N$184.8 billion a year earlier, according to the Bank of Namibia (BoN).

The figures are contained in the reserve bank’s latest quarterly bulletin, which reviews developments in the country's external sector during the first three months of 2026.

The data show the country's external debt now represents 65% of gross domestic product (GDP).

According to the central bank, the annual decline was mainly driven by the redemption of Namibia's Eurobond in the fourth quarter of 2025, which significantly reduced the country's outstanding government external debt.

The decrease was further supported by the appreciation of the Namibia dollar over the past year, which reduced the local currency value of foreign currency-denominated debt.

However, on a quarterly basis, the external debt stock increased by 4.7%, reflecting a weaker Namibia dollar towards the end of the quarter and increased direct investment intercompany lending, particularly within the mining sector.

The quarterly rise was also attributed to an increase in foreign deposits held with domestic banks and higher utilisation of trade credit by other sectors of the economy.

Mining sector dominates debt profile

The report indicates that direct investment intercompany lending remained the largest component of Namibia's external debt, accounting for 47.3% of total obligations at the end of March.

Long-term borrowing continued to dominate the debt profile, representing 97% of total external debt, while short-term debt accounted for only 3%, limiting the country's exposure to immediate refinancing risks.

Namibia's ability to meet its short-term external obligations weakened during the quarter, although it remains within internationally accepted safety levels.

The ratio of official foreign reserves to short-term external debt declined to 1.6:1, compared to 2.5:1 a year earlier and 1.8:1 in the previous quarter.

The deterioration reflects an increase in short-term external debt.

Despite the decline, the ratio remains above the conventional 1:1 benchmark, suggesting the country's reserves are still adequate to cover short-term external debt obligations.

Foreign debt repayments drop sharply

External debt-servicing obligations also eased considerably during the first quarter.

Total repayments on foreign debt fell by 52.8% compared to the same period last year and by 77.8% from the previous quarter to N$7.3 billion.

The sharp annual decline was mainly due to a high base effect following substantial repurchase agreement repayments by resident deposit-taking corporations in the corresponding period last year, as well as lower repayments on trade credits.

Quarter-on-quarter, the decline largely reflects the fact that the previous quarter included the redemption of the Eurobond and sizeable repayments on intercompany borrowing by enterprises.

Export debt burden eases

The country's debt-service-to-exports ratio also improved significantly.

The ratio declined to 24.7% during the first quarter from 93.4% in the preceding quarter and 54.8% a year earlier.

The report attributes the improvement primarily to lower external debt-service payments.

Although the ratio remains close to the upper end of the international benchmark range of 15% to 25%, Namibia's overall external debt distress risk is assessed as low.

BoN notes that nearly half of Namibia's external debt consists of direct investment intercompany lending, which generally carries lower rollover and default risks than conventional external borrowing.