By now it is common knowledge, or widely argued, that our economy did not perform as well last year as it was expected to. This article will provide an overview of economic developments during the first three quarters of 2016.
For the sake of brevity I will restrict myself to the quarterly GDP estimates as released by the Namibia Statistics Agency in 2016. For clarity sake, the quarterly Gross Domestic Product (GDP) estimates assist in the analysis of short-term movements in the economy, as opposed to the annual GDP that provides in-depth and comprehensive view of the changes in the economy.
As indicated I will only provide statistics from the first three quarters of 2016. The fourth quarter GDP, as well as preliminary national accounts, will only be released at the end of March.
The real GDP for the first quarter of 2016 recorded slow growth of 3.5 percent, compared to 6.8 percent registered in the corresponding quarter of 2015. The slow growth was attributed to the construction sector that recorded a 0.2 percent in real value added, and the poor performance in real value added in the agriculture, as well as fishing and fish processing on board.
In addition, all the sectors registered slow growth in real value-added, except hotels and restaurants, as well as the manufacturing sector, that recorded strong growth, compared to a decline in the corresponding quarter of 2015.
During the second quarter of 2016 our economy recorded a decline. It recorded a slowdown of 1.5 percent, compared to a growth rate of 7.1 percent in 2015. This poor performance was mainly attributed to the construction, hotels and restaurants and mining and quarrying sectors that recorded significant declines.
In addition, the manufacturing and agriculture sectors also registered declines in real value added. On the other hand, other sectors such as electricity and water, wholesale and retail trade and financial intermediation registered positive growth in real value added in the second quarter of 2016, compared to growth rates recorded in the corresponding quarter of 2015.
During the third quarter of 2016, our economy recorded another decline of 1 percent, leading to comments that Namibia was in a technical recession. ‘Technical’, because GDP figures are revised regularly and only once revised can these be confirmed.
Recession is usually defined as an economy that has two consecutive quarters of economic contraction. This decline of 1 percent, compared to 5 percent growth in 2015, was mainly attributed to the mining and quarrying, construction and public administration sectors that contracted in real value added.
So yes, it is true our economy did not perform as well as we wanted it to, but we still have a whole quarter to assess how the economy performed throughout the year to form a holistic view on what transpired last year.
The Namibia Statistics Agency would really like to emphasise the importance of the accurate and timely delivery of data from our stakeholders in the private and public sectors, on which the compilation of quarterly GDP estimates depends.
In the same vein the NSA would like to express its appreciation to all data providers, both, without whose assistance the timely publication of this data would not be possible. Let’s work together to better understand our situations and provide the statistics needed for development and its evaluation.
* Iipumbu Sakaria is the deputy director of strategic communications at NSA.