Macroeconomic Forecast Namibia

The new government faces the difficult challenge of achieving greater fiscal stability at the same time as dealing with poverty and HIV/AIDS. It should move quickly on structural adjustment, as buoyant world market conditions for the country's minerals represent a window of opportunity. We expect real GDP growth to remain steady, if unspectacular, but inflation will remain under pressure from high oil prices. Helpfully, the overall public sector deficit is being brought under control, but not to an extent that will allow any meaningful reduction in the burden of official debt over our forecast period. The external risk outlook is not too bad, although the level of international reserves remains a worry

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