Windhoek:Namibia's Minister of Finance, Ericah Shafudah, presented the Mid-Year Budget Review for the 2026/27 financial year, revealing a revised economic growth outlook due to a N$1.5 billion shortfall in revenue and increasing debt-servicing costs. The budget review highlighted the need for additional funding of N$13.1 billion from public institutions.

According to NAMPA, the budget review was tabled in the National Assembly, where Shafudah explained the revised fiscal outlook. She noted that the adjustments in expenditure allocations are essential to maintain fiscal sustainability and advance national development priorities amidst mounting pressure on public finances.

Under the revised projections for the 2026/27 financial year, government revenue is expected to decrease from N$89.6 billion to N$88.1 billion, primarily due to lower mining receipts, fuel levies, and administrative fees. The budget deficit is anticipated to reach N$16.3 billion, equivalent to 5.5% of the gross domestic product (GDP), and public debt is projected to hit N$201.7 billion or 68.7% of GDP. Interest payments are estimated at N$15.4 billion, which amounts to 17.5% of the revenue.

Shafudah also revised Namibia's economic growth forecast for 2026 to 2.3%, down from the previously projected 3.1% in the main budget, though still above the 1.7% recorded in 2025. Looking ahead, growth is expected to improve to 2.6% in 2027, 3.0% in 2028, and 3.3% in 2029, driven by mining projects, strong uranium and gold prices, and improved consumption as inflation and interest rates ease.

The Bank of Namibia has projected an increase in the inflation rate to 4.0% in 2026, with a slight decrease to 3.9% in 2027, reflecting higher oil price expectations. Inflation averaged 3.5% in 2025, and the central bank maintained its repo rate at 6.75% in August 2026. Additionally, international reserves were recorded at N$59.3 billion at the end of September, providing 3.6 months of import cover. The Bank of Namibia also diversified its reserves by acquiring locally produced gold worth approximately N$878 million to bolster resilience against external shocks.