National debt to cross N$200-billion mark

Namibia’s overall budget deficit is projected to increase to N$217.3 billion by the end of the medium-term expenditure framework.

The medium-term expenditure framework refers to the government’s budget for the next three years.

According to the government’s fiscal book, government debt is projected to rise from N$173.1 billion in the 2025/26 financial year to N$193.8 billion in the 2026/27 financial year.

“As a percentage of gross domestic product (GDP), the debt stock is expected to increase to 67.8% in the 2026/27 financial year from 66.1% in the 2025/26 financial year, before stabilising to 67.3% in the 2027/28 financial year and further to 65.9% in the 2028/29 financial year, signalling a turn towards long-term fiscal sustainability,” the fiscal report reads.

This means Namibia’s total debt will equal about 68% of everything the country produces in one year.

Minister of finance Ericah Shafudah last week said the country’s debt portfolio is 88% domestic and 12% foreign as at January.

She said this is a strategic move towards domestic financing.

“However, interest payments are projected to consume 16.4% of total revenue, amounting to N$14.3 billion, up from 14.7% in 2024/25,” the minister said.

This means for every N$100 the government collects, about N$16 goes to paying interest on debt.

Foreign currency debt largely comprises South African rand (9.4%), with limited exposure to China’s renminbi (0.9%), the United States dollar (0.5%), and euro (0.4 %).

“The currency configuration underscores a prudent external borrowing stance and reduced vulnerability to exchange-rate volatility,” Shafudah said.

By instrument type, the portfolio is anchored in domestic securities. Meanwhile, fixed-rate domestic bonds represent the largest component at 52.6% (N$91.8 billion), followed by treasury bills at 27% (N$47.2 billion) and inflation-linked bonds at 5.7% (N$10 billion).

Shafudah said the structure supports domestic capital market development and enhances predictability in debt servicing, although the relatively high share of treasury bills implies continued short-term rollover exposure.

“External debt instruments remain moderate in scale and diversified across concessional and semi-concessional facilities,” she said.

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