An internationally renowned rating agency, Fitch Ratings, assigned Namibia a long-term foreign currency rating of 'BBB-', and a long-term local currency rating of 'BBB'; both with a stable outlook as a result of a stable policy environment and sound macro-economic fundamentals.

The investment grade ratings are assigned using letters A (a high credit quality) to D (poorest credit quality).

Namibia becomes the third country in sub-Saharan Africa to receive an investment-grade credit rating after South Africa and Botswana.

"It benefits from a low public and external debt burden, high domestic savings and current account surpluses, macro-economic stability and relatively robust growth," Veronica Kalema, sovereign credit analyst at Fitch, said in a statement.

"The country has the advantage of an abundance of mineral resources, which have been well managed, and is politically stable, all of which further support the ratings," she added.

Addressing journalists at her offices yesterday, Kuugongelwa-Amadhila said this rating puts Namibia ahead of most countries at similar levels of development, which she said had been generally assigned a speculative grade.

"This commendable achievement is the result of a stable policy environment and sound macro-economic fundamentals, and it shows that the fiscal and monetary policies pursued by the Government are on the right track.

"Government is content with the fact that the rating agency has recognised these efforts and achievements in their grading, while also taking into account some weaknesses that we are all aware of," said Kuugongelwa-Amadhila.

The assessment, which was sponsored by the US government, will be reviewed annually and Kuugongelwa-Amadhila said it would be a challenge for the country to maintain the current status.

She noted that one of the weaknesses was a concern about high capital outflows, which deprived the country of much-needed investment and also hampered the build-up of foreign reserves.

High unemployment, the economic effects of HIV-AIDS and reliance on the primary sector were other issues that needed to be addressed, she said.

Kuugongelwa-Amadhila said there was also a need for investment in human capital development and diversifying the economy.

"I hope the credit rating will help the financial sector in Namibia to make their contribution to the development of our country, in particular, help to create and pursue domestic investment opportunities.

With this rating I believe Namibia can establish a footprint in the international capital markets and will become more known among international investors," she said.

Fitch Ratings is an international credit-ratings agency with offices in over 75 countries.

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