Namibia: 2019 Article IV Consultation-Press Release and Staff Report

IMF Staff Country Reports, September 13, 2019

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Namibia: 2019 Article IV Consultation-Press Release and Staff Report

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Bibliographic details

• Published: September 13, 2019
• Series: IMF Staff Country Reports
• DOI: https://doi.org/10.5089/9781513513904.002

Overview and Outlook

• With the temporary stimuli now ended, the economy is rebalancing while the government is implementing a significant fiscal consolidation.
• The outlook is challenging due to:
  • A likely slow recovery.
  • The need for further fiscal adjustment to bring public debt to a sustainable path.
  • Persistent inequalities and structural impediments to growth.
• Immediate measures are needed to deliver the authorities’ fiscal adjustment plans and bring public debt to a sustainable path.

Fiscal Policy and Public Debt

• Policy guidance:
  • Combine spending reductions and revenue increases that support long-term growth.
• Fiscal consolidation is underway and needs reinforcement to ensure public debt sustainability.
• Subject areas highlighted: Fiscal consolidation, Fiscal policy, Fiscal stance, Government debt management, Public debt, Public financial management (PFM), Revenue administration.

Social Protection and Poverty Mitigation

• Recommendation:
  • Better targeting of cash transfers would protect the poor.
• Policy emphasis:
  • Protect vulnerable groups while implementing fiscal consolidation measures.

Structural Reforms and Competitiveness

• Structural reforms are urgently needed to strengthen productivity and external competitiveness and boost long-term growth.
• Recommended reform areas:
  • Streamline business regulations.
  • Contain public sector wage dynamics.
  • Reduce costs of key production inputs.
• Medium- to long-term priorities:
  • Remove non-tariff barriers to exports.
  • Foster the adoption of new technologies.
  • Address shortages of skilled workers.
• Related structural concerns noted: slowing productivity growth, private sector indebtedness, costs of production inputs, non-tariff export barriers.

Key Findings and Policy Recommendations (bullet summary)

• Immediate actions:
  • Deliver authorities’ fiscal adjustment plans.
  • Combine spending cuts and revenue measures that do not harm long-term growth.
  • Better target cash transfers to protect the poor.
• Structural agenda:
  • Streamline business regulations.
  • Contain public sector wage dynamics.
  • Reduce costs of key production inputs.
  • Remove non-tariff export barriers.
  • Promote technology adoption and address skills shortages.

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