Hertha Ekandjo
Namibia’s total government debt increased to N$178.4 billion at the end of March 2026, up from N$172.7 billion at the end of December 2025, as the government continued to rely on domestic borrowing to finance its operations.
According to the Bank of Namibia’s latest Quarterly Bulletin, the debt stock recorded annual growth of 7.0%, compared to 5.4% at the end of December 2025.
Future Media reports that the central bank said the increase was largely driven by higher issuance of Treasury Bills and Internal Registered Stock, although the government continued reducing external debt through the redemption of the Eurobond and repayments on other foreign loans.
Despite the decline in external debt, total government debt stood at 65.0% of GDP at the end of March 2026, representing a slight increase from a year earlier and remaining above the Southern African Development Community benchmark of 60% of GDP.
While debt continued to rise, the Bank said government made progress in reducing its contingent liabilities.
Explaining the situation, Economist Gabriel Nghinomenwa said the debt-to-GDP ratio above the SADC benchmark signals underlying fiscal and economic vulnerabilities.
He explained that the ratio is used internationally as a warning indicator because it reflects how much of a country’s total economic output is being weighed against its various debt obligations.
“These ratios are there for a reason. Historically, when a country exceeds such levels, it shows that something is not right,” Nghinomenwa said.
“It is a comparison between what you produce and what you owe. GDP represents the total goods and services produced, while debt is what the country must repay. When GDP is not growing fast enough, it means a growing share of what is produced will go towards debt servicing.”
He added that once debt levels rise too far above economic output, countries risk entering a situation where more of their income is diverted to servicing obligations rather than productive spending.
“That is why there is a threshold. It signals vulnerability in the economy and possible weaknesses in fiscal discipline or economic performance,” he said. “It shows whether the economy is strong enough to support its financial obligations through domestic production and revenue.”
Total central government loan guarantees declined by 19.0% year-on-year to N$7.0 billion at the end of March 2026, following repayments on domestically guaranteed loans for state-owned enterprises in the energy, transport and agriculture sectors.
The Bank said while public debt continues to trend upward due to domestic borrowing requirements, the reduction in external debt and guaranteed liabilities reflects continued efforts to improve fiscal sustainability as well as manage government financial risks.
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