WINDHOEK - 2012 is likely to be another trying year for Namibian exporters and those who have invested their savings should not hold hopes of high returns.

Local analysts and economists have finally fine-tuned their outlook for the year, albeit with the usual ‘on the one hand’.

They all side with an earlier outlook of a ‘perilous 2012’.

The current situation is so uncertain that fund managers and analysts cannot even attempt to speak with certainty about the best medium for investors to put their hard earned cash at this point. This is because the unfolding situation continues to elude them.

Anil Thakersee, portfolio manager at Old Mutual Group, summed up the outlook as that of a world economy that will struggle, and that Europe will lurch from crisis to crisis.

Chinese house prices will fall, and American politicians will focus on politics.

“And for investors, earnings growth will slow and disappoint analyst expectations,” says Thakersee.  
However, what is happening in Europe, together with impeding uncertainty in emerging markets such as China, has cast doubt on the growth of Namibia’s exports.

Local economist Daniel Motinga suggests that local exporters should find alternative markets.

“The foregoing growth numbers make it clear that a significant number of Namibia’s export destinations do have a neutral to negative growth outlook.

“This will affect commodity exports. Therefore, it is important for local exporters to target new markets from a risk diversification perspective,” says Motinga.

Challenges in key export markets are expected to impact on economic growth, which Motinga has now revised to 4 percent from an earlier forecast of 4,5 percent. He says the impact “could depress commodity prices with an adverse knock-on effect on resource exports”.

The real growth in government spending is forecasted to slow down to around 9.1 percent.

“There is some upside to consumer demand as we have observed a balance sheet repair but it won’t be enough to take us beyond real GDP growth of 4 percent. We see investment-spending tapering off to around 4.1 percent for 2012. Investment spending should accelerate into 2013 and 2014 as projects such as Husab and Kudu gas take off with positive growth implications,” said Motinga.

The jovial and exuberant expectations for this year’s world economic performance is gone.
In its place is a darker and more depressing outlook, with fears that the ongoing crisis in the eurozone could drag the world into a similar situation to that of the 2008 economic crisis.

The International Monetary Fund (IMF), in the new global outlook, revised its earlier forecast from 4 percent to 3,3 percent, describing the near-term outlook as “perilous” echoing the same warnings as those by the World Bank regarding dangers from the escalation of the euro area debt crisis.

The current mood is so ominous that the IMF says consumer prices are emerging and developing economies are expected to remain relatively higher at over 6 percent in certain regions, as intentional market lose confidence.

Even though demand is expected to soften as commodity prices stabilise or recede, with a drop in growth and food price inflation within emerging and developing economies, the IMF says “inflation is expected to remain persistent in some regions”.