Savings rate up again

The country’s savings rate has recovered after declining in recent years, the Namibia Statistics Agency said recently.
After declining markedly in the aftermath of the international financial crisis in 2009, Namibia’s gross savings to GDP ratio rebounded to 30.5% in 2012; the first time in two years that the savings rate has grown faster compared to the investment rate. For 2012, Namibia’s gross fixed capital formation or investment ratio stood at 21.1%, a 11.6% increase from the previous year.
Namibia has had historic low interest rates since August 2012 which analysts feared would fuel consumption while discouraging saving, but despite these fears, the country’s net savings increased 75.2% to N$19.3 billion last year mainly driven by savings by the private sector.
Namene Kalili, Manager of Research at FNB said while there was a 6.8% growth in consumption  expenditure in 2012, most of the growth came from the government sector. He added that while private consumption was above average, consumers still saved up to almost 30% of their income.
Statistician General, John Steytler told The Economist that although he is pleased with the rebound in savings, he was concerned that the country was not retaining these savings.
Steytler said: “It’s a higher rate (savings rate), but my worry is that we don’t retain the savings; a big part of it is still leaving the country.”