Namibia’s economy continues to chart a path of growth, but the drivers behind this expansion tell a story of contrasting fortunes across sectors. While the tertiary industries and government expenditure have emerged as the backbone of economic activity, primary sectors like agriculture and fishing are grappling with significant challenges, painting a complex picture of the nation’s economic landscape.
The latest GDP report from the Namibia Statistics Agency (NSA) reveals that the tertiary sector, which includes health, wholesale and retail trade, and financial services, has been the primary catalyst for growth in the first quarter of 2025. Health services alone surged by 11.4%, marking the highest growth rate among all sectors. This remarkable performance is attributed to an increase in health personnel and expanded access to medical services, reflecting the government’s ongoing investments in public health infrastructure. Wholesale and retail trade followed closely, growing by 6.5%, driven by rising consumer demand and improved revenue streams for businesses. Financial services also posted a robust 6.0% growth, buoyed by increased banking activities and a rebound in insurance premiums.
Administrative and support services, another pillar of the tertiary sector, grew by 5.7%, fueled by heightened demand for security and car rental services. These sectors collectively contributed significantly to the GDP, underscoring their critical role in sustaining economic momentum. The resilience of the tertiary industries highlights Namibia’s gradual shift towards a more service-oriented economy, a trend that aligns with global economic transformations.
On the demand side, government final consumption expenditure rose by 5.8%, outpacing the 3.2% growth recorded in the same quarter of 2024. This increase is largely due to higher public sector wages and expanded government spending on goods and services. The rise in public servants’ numbers further bolstered this expenditure, demonstrating the government’s role as a key economic actor. Meanwhile, private final consumption expenditure experienced a marginal decline of 0.7%, as households tightened their belts amid slower income growth.
Gross fixed capital formation, a measure of investment in the economy, grew by 3.8%, driven by increased spending on machinery, transport equipment, and construction activities. This uptick signals renewed confidence in Namibia’s infrastructure development, with both public and private sectors contributing to the expansion. The construction sector itself grew by 2.5%, rebounding from a contraction in the previous year, thanks to government-funded projects and a rise in building plans completed.
However, not all sectors shared in this growth. The primary industries, particularly agriculture and fishing, faced severe setbacks. Agriculture and forestry contracted by a staggering 20.1%, a sharp decline from the previous year’s performance. The sector was hit hard by the lingering effects of the 2024 drought, which forced farmers to reduce livestock holdings. An outbreak of Lumpy Skin Disease further exacerbated the situation, leading to a 24.2% drop in cattle marketed for export. Similarly, the fishing sector declined by 8.7%, with reduced fish landings due to weaker midwater fisheries activity. These challenges underscore the vulnerability of Namibia’s primary industries to climatic and environmental shocks.
The secondary industries also struggled, with manufacturing declining by 1.7%. Subsectors like grain mill products and fish processing onshore recorded significant drops, reflecting broader challenges in production and demand. However, there were bright spots within manufacturing, such as basic non-ferrous metals and wood products, which posted strong growth, indicating potential for diversification within the sector.
Mining and quarrying, a traditionally strong sector, grew by a modest 2.0%, with uranium mining leading the charge at 36.5% growth. This surge was driven by favorable international prices and rising global demand for uranium. Diamond mining, however, declined by 4.0%, reflecting weaker global demand for gemstones.
On the external front, exports of goods and services grew by 15.6%, while imports increased by 6.2%. This narrowing of the trade deficit is a positive sign for the economy, suggesting improved competitiveness in international markets. The performance was largely driven by intermediate goods, highlighting Namibia’s integration into global supply chains.
The NSA’s report emphasizes the importance of timely and accurate data collection from both public and private sectors to ensure robust GDP estimates. Statistician-General Alex Shimuafeni commended data providers for their contributions while urging stakeholders to continue supporting statistical efforts to enhance economic planning and policy-making.
As Namibia navigates its economic trajectory, the contrasting performances across sectors reveal both opportunities and challenges. The tertiary sector and government spending are currently the engines of growth, but the struggles of primary industries remind the nation of the need for diversification and resilience. With strategic investments and policy support, Namibia can harness its potential to build a more balanced and sustainable economy for the future.
The road ahead will require addressing structural weaknesses in agriculture and fishing while capitalizing on the strengths of services and mining. For now, the tertiary sector remains the star of the show, driving Namibia’s economic narrative forward.