EDITORIAL: Our escalating debt burden

Namibia’s public debt is projected to swell from N$174.6 billion (65.2% of GDP) in the 2025/2026 financial year to a staggering N$217.3 billion by 2028/2029.

The debt-to-GDP ratio is expected to hover around 67.5% during this period. Beneath these numbers lie a more troubling reality - rising interest payments, expanding financing needs, and a dangerous dependence on volatile revenue streams such as Sacu receipts.

For a country that has long prided itself on prudent economic stewardship since independence, this trajectory should alarm us. Debt in itself is not evil. But unmanaged debt erodes sovereignty, narrows policy choices and mortgages the future to external creditors.

There was a time when Namibia borrowed with extreme caution. Under founding President Sam Nujoma, the country maintained a remarkably conservative debt posture of between 17.17% in 1993 and 26.9% when he left office in 2005. Borrowing from multilateral institutions was a no-go area for Namibia - partly to preserve policy autonomy and shield the country from externally imposed conditionalities.

That prudence defined an era.

The shift since then has been stark. By 2021, amid Covid-19 and mismanagement by our own hand, debts hit 69.6% of GDP.

The consequences are not abstract. Interest payments alone are estimated at N$16.2 billion this year - exceeding the N$13 billion allocated to the entire health sector. That means we are spending more on servicing debt than on healing the sick.

With debt levels breaching the former self-imposed ceiling 30% of GDP, the country must rediscover its fiscal discipline, without abandoning its ambitions.

We must eliminate waste, tightening procurement, curbing corruption and ensuring that every borrowed dollar translates into measurable economic return. We must also accelerate economic diversification and reform revenue mobilisation intelligently.

Borrowing to invest in productivity is defensible. Borrowing to plug recurrent deficits is not.