Namibia holds N$62bn in hidden export potential

Untapped
Ogone Tlhage
  • 12 Hours Ago
A Rand Merchant Bank (RMB) report has found that Namibia has an untapped export potential of approximately N$62 billion (US$3.2 billion) in earnings that are currently not being realised.



As a percentage of gross domestic product (GDP), this represents a staggering 29% of Namibia’s GDP, the investment and corporate banker noted.



RMB explained that Namibia finds itself in a difficult position: low investment levels and high current account deficits have limited the country’s growth momentum, despite its considerable export potential.



A comparative study by RMB revealed that Namibia has a gross capital formation of just 20% of GDP, combined with a current account deficit of 10–12%.



“Economies such as Malawi and Namibia suffer from both low investment and current account deficits, flagging limited growth momentum and heightened external vulnerability. This is an economic conundrum. One needs exports to build productivity, and productivity to generate exports,” RMB stated, drawing parallels between the two nations.



According to the report, while global attention focuses on exports to the United States, the majority of export potential for the 31 African countries studied lies outside the US. For Namibia, untapped export potential to the US alone stands at N$1.68 billion (US$97 million).



Despite the challenging outlook, RMB highlighted that potential investments in oil and gas could propel economic growth close to 10%.



“Economically, Namibia is among the world’s most unequal countries, alongside South Africa. A path away from heavy reliance on extractive industries and diamond exports towards broader prosperity may lie in recent offshore oil and gas discoveries – which leaders suggest could boost economic growth to 8% within a decade,” RMB said.



RMB also noted Namibia’s inherent constraints on growth, including water scarcity and a small population.



“Namibia’s contrasts are stark. Just three million people occupy 825 000 square kilometres, making it one of the least densely populated countries in the world. Despite a coastline of more than 1 500 km along the Atlantic Ocean, the country suffers severe water scarcity, having recently endured a drought that devastated agricultural output,” RMB said.



In the bank’s ‘Where to Invest in Africa 2025’ report, Namibia was ranked as the 17th most attractive country to invest in out of 31 jurisdictions, moving up one place from the previous year.