Windhoek:Finance Minister Ericah Shafudah has defended the Namibian government's revised expenditure of N$105 billion for the 2026/27 financial year, stating that the adjustment was essential for addressing emerging priorities while managing public debt.

According to Namibia Press Agency, Shafudah presented the midterm budget in the National Assembly, noting that the government had reduced total expenditure by 0.9% despite facing a revenue shortfall of N$1.5 billion and additional funding requests totaling N$13 billion.

The minister addressed contributions and concerns from parliament members regarding the growing public debt and the associated costs of servicing it. Shafudah acknowledged that the nation faces significant challenges, with slowed growth and revenue shortfalls compounded by external shocks such as increased fuel prices and a foot-and-mouth disease outbreak affecting the economy.

Shafudah detailed that the revised budget was formulated to emphasize economic development, fiscal outlook, progress on priority projects, and fiscal policy priorities for the upcoming Medium-Term Expenditure Framework. She conceded that interest payments on the debt exceeded twice the N$6.6 billion allocated for development projects through the State Revenue Fund, emphasizing the need to consider infrastructure projects funded from outside this fund.

The minister also mentioned the reallocation of N$685 million from underperforming projects and offices, affirming that these funds were redirected to areas that could utilize them within the current financial year. The revised budget allocates N$179 million to combat the foot-and-mouth disease outbreak and provides funding for grain reserves, public servants' medical aid, and the Contingency Fund.

In response to concerns about economic growth, Shafudah highlighted investments in sectors such as mining, energy, water infrastructure, and green hydrogen, which are expected to bolster future growth and employment opportunities.