## IMF Staff Completes 2017 Article IV Mission to Namibia

_IMF News, December 12, 2017_

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**Canonical URL:** [IMF Staff Completes 2017 Article IV Mission to Namibia](https://www.imf.org/en/news/articles/2017/12/12/pr17485-imf-staff-completes-2017-article-iv-mission-to-namibia)

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## Bibliographic details
- Published: December 12, 2017

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### Economic outlook and growth projections
- The IMF staff notes: "After years of exceptional growth, the economy has entered an adjustment phase."
- Growth is expected to "turn slightly negative in 2017," compared to a growth of "1.1 percent in 2016."
- Growth is projected to "resume in 2018 and accelerate thereafter to about 4 percent as production from new mines ramps up and manufacturing and retail activities recover."
- Downside risks highlighted: "volatile Southern African Customs Union (SACU) revenue, subdued commodity prices, and fiscal slippages that could undermine policy credibility."

### Fiscal challenges and policy recommendations
- With "SACU revenue declining, significant fiscal adjustment is needed to ensure debt sustainability and macroeconomic stability."
- Policies should address sources of recent deterioration, including "public wage costs."
- Recommended measures should "combine expenditure and revenue measures that can support long-term growth, while safeguarding critical social and development spending."
- Key fiscal governance actions urged:
  - "Strengthening revenue administration"
  - "Improving budget formulation and expenditure controls"
  - "Carefully managing extra-budgetary entities and public enterprises"
  - "Avoiding risk taking from off-budget operations" to protect the credibility of adjustment
- The mission "welcomes the authorities’ commitment to undertake additional measures to reduce the fiscal deficit, as stated in the recent Mid-Year Policy Statement."

### Financial sector soundness and reform priorities
- The mission: "The financial sector remains sound."
- Authorities are taking steps to manage risks and advance reforms, including:
  - "Strengthening bank’s liquidity monitoring and asset classification"
  - "Introducing a bank resolution regime"
  - "Expanding the macroprudential toolkit"
  - "Upgrading the non-bank regulatory and supervisory framework"
- Expected benefits: these actions "should help address macro-financial and structural vulnerabilities, including some banking and non-banking sector weaknesses, rising real estate prices, relatively high household indebtedness, and complex linkages across financial institutions."

### Structural and social policy priorities
- Key challenges: "to manage the ongoing adjustment process and preserve macroeconomic stability, while reducing unemployment and income inequality."
- Government actions to date: "The government has taken actions to support growth, tackle high unemployment, particularly among the youth, and reduce income inequality."
- Reforms with potential to boost employment and inclusiveness:
  - "Addressing the shortage of skilled workers"
  - "Better aligning wage dynamics to productivity trends"
  - "Simplifying business regulations"
- The mission notes these reforms "have the potential to significantly boost employment and deliver more inclusive growth."

### Mission details, consultations, and next steps
- IMF staff team led by Mr. Geremia Palomba, "IMF Mission Chief for Namibia," visited Windhoek during "November 30-December 12, 2017" to conduct the 2017 Article IV Consultation with Namibia.
- At the conclusion of the visit Mr. Palomba stated the findings quoted throughout this release.
- The mission met with "Prime Minister Saara Kuugongelwa-Amadhila, Minister of Finance Calle Schlettwein, Bank of Namibia Governor Ipumbu Shiimi, other senior officials, and financial market, business and union representatives."
- The findings of the mission "will be reflected in the 2017 Article IV staff report." This report, together with the joint IMF-World Bank Financial Sector Assessment Program (FSAP) report, "is expected to be discussed by the IMF Executive Board in early 2018."
- Press release identification: "Press Release No. 17/485."

*IMF Communications Department — Press Release dated December 12, 2017*

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## References

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_Source: https://www.imf.org/en/news/articles/2017/12/12/pr17485-imf-staff-completes-2017-article-iv-mission-to-namibia_