With political stability, good economic management and a welcoming attitude towards foreign investment, Namibia presents many investment opportunities, particularly in natural resources. The country’s medium-term growth will be driven in the main by capital-intensive investment projects in the mining and infrastructure space, while key exports such as diamonds and uranium will benefit from gradually improving demand conditions in key markets.

We keep our clients informed of the latest market moves and political developments in Namibia, as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on 11 of Namibia’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our results-proven research teams. Our aim is to keep you ahead of the curve, so you can feel confident doing business in Namibia.

Country Risk

Namibia Country Risk

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Core Views:

  • The Namibian economy will post solid growth of 6.4% annually over the next five years. Growth will be driven in the main by capital-intensive investment projects in the mining and infrastructure space, while key exports such uranium will benefit from robust Chinese demand

  • The landslide victory for president-elect Hage Geingob and the ruling SWAPO in Namibia's general elections on November 28 2014 augurs for broad political stability and a pro-business economic agenda. The result means that SWAPO will expand on its two thirds majority in the national assembly. Hopes for a shift towards a more inclusive electoral landscape continue to prove elusive.

  • Namibia's current account deficit will widen to around 9.9% of GDP in 2015 from an estimated 10.3% in 2014, before narrowing to 8.6% of GDP in 2016.

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Namibia Operational Risk Coverage (9)

Namibia Operational Risk

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BMI View: Namibia is a low risk country by regional standards. Its solid infrastructure, openness to trade and strong legal framework make it an attractive location for investors to locate in the Sub-Saharan African (SSA) region. However, it is not the most attractive investment destination due to its vastly dispersed and relatively poorly educated labour force, high levels of red tape and underdeveloped financial market that restricts business' ability to raise credit. Taking these factors into account, BMI awards Namibia an overall Operational Risk score of 51.8 out of 100, placing the country fourth out of 48 states in SSA, between the ...

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Namibia Crime & Security

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From a regional perspective, Namibia is a safe and politically stable country. Although crime in the form of pick-pocketing, purse snatching and burglaries are relatively common, crimes to the person tend to be forms of domestic violence as opposed to targeted attacks. In addition, the country has an extremely low terrorism risk and a capable military. The country is considered low risk by the UK Foreign and Commonwealth Office Travel Advice, although it is advised that travellers exercise a sensible degree of caution. Consequently Namibia scores 66.7 out of 100 for its Crime and Security Risk, ranking it second in the Sub-Saharan African region behind Lesotho.

Crime in the capital city of Namibia, Windhoek, is high, with muggers often targeting foreign tourists. Attacks can take place in busy city centre locations in broad daylight, as well during late night journeys home. There have also been cases of credit card skimming at some hotels and...

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Namibia Labour Market

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BMI View: Namibia's labour market offers a number of opportunities to businesses looking to invest in Sub-Saharan Africa. A relatively high life expectancy, good rates of female participation in the labour force, strong literacy rates, low labour tax and minimal severance pay costs make the country a highly attractive location for businesses to invest in. However, the country does pose risks in terms of its low enrolment rates in secondary and tertiary education, high unemployment, and uncompetitive annual leave costs. These risks increase costs to businesses due to the need to employ foreign workers, train unskilled labourers and compensate for holiday leave. Scoring 4...

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Namibia Logistics

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With one of the most highly ranked logistics networks on the continent, Namibia has become a regional transport hub, particularly for its landlocked neighbours, which benefit from its well-developed port and road infrastructure. Significant investments are being poured into ongoing projects to further boost the country's port, airport, road and railway infrastructure in an effort to increase its international appeal, but businesses remain burdened by Namibia's lengthy and burdensome trade governance processes, which multiply costs, lead times and delays. The country's limited utilities capabilities also present a notable source of risk, particularly in Namibia's vulnerability to droughts, its expensive Internet services, and its dependence on power and fuel imports. As such, Namibia scores 46.4 out of 100 for Logistics, ranking fourth in the region, between Seychelles and Ghana.

Namibia's economic and trade growth represents a major source of...

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Namibia Trade & Investment

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BMI View: Namibia is a regional outperformer for Trade And Investment Risk thanks to its openness to trade and a regulatory environment that is both clear and favourable towards foreign investors. The country is ranked seventh out of 48 countries in Sub-Saharan Africa, with a score of 50.2 out of 100. We attribute this to the high risks stemming from high levels of red tape when it comes to opening a business and registering property, and lower FDI levels than its regional peers.

Namibia's openness to trade and investment flows have seen the country's economy expand rapidly in the past decade, with real GDP rising from USD3.37bn in 2002 to USD13.4bn in...

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Namibia Industry Coverage (12)

Agribusiness

Namibia Agribusiness

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BMI View: We expect food security in South West Africa to improve over the short term, as we expect higher corn production from Zambia in 2014/15. Only in parts of Angola do we see food security being at risk, owing to the increase in fuel costs in 2014, which is expected to result in upward pressure on food prices and could negatively impact on food access, particularly in deficit producing areas. Over...

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Autos

Namibia Autos

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According to the Bank of Namibia (BoN), new vehicle sales in Q115 came in at 5,813 units, an increase of 14.3% y-o-y from Q114 sales of 5,086 units. After rising by 36.4% in 2014 to 21,718 units, auto sales have continued their steady expansion for the first quarter of 2015. We remain bullish on vehicle sales and forecast growth of 16.0% in 2015 to 26,062 units. While our Country Risk team forecasts the BoN to hike rates by a further 25bps in 2015 to 6.75% in 2015 ( see 'Rate Hikes As Inflation Set To Average 10 Year Lows', July 16), we do not see this derailing the positive consumer story.

We have been bullish on auto demand for some time and recent industry sales figures reinforce our view. With our Country Risk team forecasting GDP growth to pick up in 2015 to 5.3% versus 4.5% in 2014, auto sales will continue growing at a steady clip. Over the longer term we retain a bullish...

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Commercial Banking

Namibia Commercial Banking

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Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

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Food & Drink

Namibia Food & Drink

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BMI View: Despite having a relatively high per capita income of USD5,721 in 2014, Namibia's income distribution is among the worst in the world. Although we still estimate that around one-third of the labour force is unemployed, poverty has been on a downward trend for more than a decade. The Fourth National Development Plan (launched in 2012) aims to tackle these problems with a programme designed to run until 2017. However, the country's relatively small population and rising concerns about a looming energy crisis make Namibia less attractive...

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Freight Transport

Namibia Freight Transport

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BMI View: Our forecast for the Namibian freight transport sector is positive, in both the near and longer term. Domestic economic growth and an expanding mining sector will continue to drive demand within the country, while continuing investment in freight transport links - both road and rail - with hinterland countries such as Botswana and Zimbabwe will see transit volumes grow. The Namibian economy will post solid growth of 5.0% in 2015, and expand by the same average pace annually over the next five years, which will naturally drive growth in freight volumes. There are risks to the downside in the near term, as falling commodity prices could forestall investment into the mining sector, and the...

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Infrastructure

Namibia Infrastructure

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BMI View: The ending of government stimulus and lower commodity prices will weigh on infrastructure growth over coming years, with our forecasts seeing a notable slowdown in the construction sector's real growth. However, Namibia's positioning as a regional logistics hub and key export route for landlocked neighbours, as well as ambitions to lower dependence on South Africa for electricity will help maintain growth.

Key Trends And Developments

  • The Namibia Ports Authority revealed construction on Namibia's port, called Southern Africa Development Community Gateway Port, 5km north of Walvis Bay, will start in 2015. The first phase will include construction of a NAD4bn (USD365.28mn) oil tanker jetty, a 75mn litre oil storage facility and petroleum...

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Insurance

Namibia Insurance

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BMI View: Dominated by the local elements of South Africa's leading insurance companies, Namibia's insurance sector unsurprisingly shares many characteristics with that of the much larger neighbour. At around 8.1% of GDP and USD457 per capita, respectively, total penetration and density are at levels that are very high by the standards of Sub-Saharan Africa. Both major segments should enjoy steady growth through the forecast period, thanks to innovation by the insurers in terms of product development (e.g. micro-insurance) and distribution (e.g. through mobile phones). The smaller non-life segment should grow significantly faster than the life segment. This is because the non-life segment will benefit from the further expansion of basic private accident covers. The non-life segment's fortunes should also be boosted by the rapid growth in the number of cars on Namibia's roads and by coverage...

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Mining

Namibia Mining

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BMI View: While Namibia holds substantial diamond and uranium reserves as well as other minerals, the government's willingness to use its policy powers to extract greater revenue from the sector remains a key downside risk for investors. Overall, we forecast Namibia's mining industry value will grow on average 4.7% y-o-y from an estimated USD1.5bn in 2014 to USD1.9bn in 2018. This will represent a decline in the mining sector's contribution to GDP from 13% in 2014 to 10% in 2018. On the positive side, we anticipate...

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Pharmaceuticals & Healthcare

Namibia Pharmaceuticals & Healthcare

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BMI View: Pharmaceuticals originating from neighbouring South Africa dominate the domestic market, with Indian firms also having a strong presence. The market is mostly comprised of generic medicines, though patented drugmakers do supply the Namibian pharmaceutical market as well. According to the NMRC Medicines Register, last updated in 2012, 13 of the top 20 selling drugs from 2012 (according to IMS Health) were registered in the country, including the top seller - GlaxoSmithKline's Seretide (salmeterol xinafoate/fluticasone propionate) - and the third biggest seller - AstraZeneca's Crestor (rosuvastatin calcium).

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Power

Namibia Power

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BMI View: Namibia is at a critical juncture in the development of its electricity sector. The country faces a severe crisis in the provision of power as it relies on a dilapidated hydropower system, vulnerable to breakdown and drought, and on imported electricity from South Africa. Various projects are in the pipeline, which will transform the country's ability to generate electricity over this decade, above all the Kudu gas-fired power station and the Arandis power station, as well as further investments in hydropower and solar energy. Together, these...

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Telecommunications

Namibia Telecommunications

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BMI View : BMI's Q315 Southern Africa report analyses the latest industry, regulatory and macroeconomic developments in the telecoms markets in Angola, Botswana, Mozambique, Mauritius and Namibia. It also contains our estimate of the market data relating to the end of 2014 and an update of our five-year forecasts to 2019 for the mobile, fixed-line and internet sectors. From the five states...

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Tourism

Namibia Tourism

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Namibia is a burgeoning tourism destination in Sub-Saharan Africa. The country offers enormous potential as a tourism market, with plentiful scope for expansion of the hotel sector and a broad range of attractions to entice visitors. Supporting infrastructure is, however, underdeveloped and will require significant investment in order to sustain long-term growth.

Subdued economic conditions in key source markets will impact the short-term growth of tourism arrivals to Namibia, with a fall in arrivals from major source markets including South Africa and Germany expected to result in an overall contraction in visitor numbers in 2015. Throughout the remainder of the forecast period we do expect to see more positive growth figures as Namibia raises its profile on the global tourism stage and highlights its range of attractions.

Both the inbound travel market and outbound departures are dominated by countries within the Sub-...

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