Economic prospects remain gloomy

Staff reporter – The leading indicator of the IJG Business Climate Monitor spent its 22nd consecutive month below the 50-point mark in July, an indication of the “strong headwinds” experienced by the Namibian economy.The leading indicator is used to forecast the forthcoming pattern of the overall economy. A value below 50 points indicates an economic contraction.The leading indicator has been below the 50-point mark since October 2016. Before that, the last time the indicator dipped below 50 was in 2003.The leading indicator in July was 40.63, the same as the month before.The IJG Business Climate Monitor (BCM) reversed the upward trend in July that started a year ago and declined to 52.90 from 54.37 in June.According to the BCM ten indicators showed an improvement, 17 deteriorated and four remained unchanged. IndicatorsCopper cathode, diamond and uranium production decreased compared to June, but remained above output levels in May 2018. The number of livestock marketed fell as beef prices declined while lamb prices rose.The value of building plans approved in Windhoek continued to increase, this time by more than 50% compared to June, which will bode well for the construction sector in the near future. The trade deficit remains at a high level, which will continue to exert pressure on the foreign exchange reserves. The increase in passenger vehicle sales, which reached its highest level since March 2017, is a cause of concern, since such purchases are usually not an investment in productive assets, while the number of commercial vehicles sold dropped in July, although the sales remained above the average for the first seven months this year. The trends in vehicle sales are reflected in the increase in credit to individuals, while credit extended to businesses declined in July 2018.

Economic prospects remain gloomy

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Republikein 2025-07-03

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Economic prospects remain gloomy

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