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Namibian economy contracts by 11.1% in second quarter

Namibian economy contracts by 11.1% in second quarter

Zorena Jantze

THE domestic economy contracted by 11.1% during the second quarter of 2020, compared to a decline of 3.6% recorded in the corresponding quarter of 2019.

 

This makes it the highest contraction recorded since the commencement of compilation of quarterly Gross Domestic Product (GDP).

 

This was revealed by the Namibia Statistics Agency (NSA), which released the country’s GDP figures for the second quarter.

 

Statistician General at the NSA, Alex Shimuafeni, stated that the last severe contraction of 6.1% was recorded in the first quarter of 2009, resulting from the impact of the global financial crisis.

 

Namibian economy contracts quarter domestic economy contracted 11.1% 2020
STEEP DECLINE: Statistician General, Alex Shimuafeni. Photo: NSA

 

Shimuafeni stated that the contraction in the economy during the second quarter of 2020 is observed across the entire sectors of the economy as domestic activities were under pressure due to the impact of the COVID-19 measures that were put in place for the country to mitigate and contain the spread of the virus.

 

The measures entailed, among others, closing of the country’s borders and only allowing businesses that provides essential services to operate.

 

However, of the 16 sectors under observation, 3 sectors recorded positive performance during the period under review.

 

The improved performances were observed in Agriculture and Forestry, Information and Communication and the Health sectors that recorded growth rates of 47.2%, 11.0 % and 6.0 %, respectively.

 

The positive performance in Agriculture and Forestry is due to a bumper harvest in the cereal production resulting from good rainfalls experienced during the period under review.

 

The Information and Communication sector growth resulted from increased activities in the usage of data as demand surged up for data and calls as workers switch from working from offices to homes.

 

This was further exacerbated by demand from higher institutions switching from face to face teaching to online learning.

 

The Hotels and Restaurants sector recorded the deepest contraction of 64.2% in real value added, compared to an increase of 12.3% registered in the same quarter of 2019.

 

The poor performance in the sector emanated from depressed demand for leisure activities due to the lockdown imposed across the country, resulting in massive cancellation of bookings from domestic and international travellers.

 

The Fishing and Fish processing on board sector registered a decline of 10.5% in real value added in the second quarter of 2020, compared to a decline of 4.5% recorded in the corresponding quarter of 2019.

 

The weak performance witnessed in the sector was mainly reflected in demersal fisheries landings, which recorded a decline of 12.2%.

 

The Mining and Quarrying sector registered a decline of 2.6% in real value added during the second quarter of 2020, compared to a deeper contraction of 25.5% recorded in the corresponding quarter 2019.

 

The decline was mainly reflected in the uranium and other mining & quarrying subsectors that registered contractions of 16.9% and 18.0%, respectively.

 

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