Chart of the Week

Fixed investment is the lifeblood of any economy. Long term capital investment, whether domestic or foreign, creates jobs, pays tax, increases economic output, increases net-exports and more. In this regard, the inflow of capital into fixed assets is a strong leading indicator for growth and job creation. However, not all investment is created equal. Over the past two years, fixed capital investment in Namibia has picked up substantially, however this is driven almost exclusively by investment into mining activity, especially oil and gas related activities. Mining investment is capital intensive - good for tax, output and net-exports, but doesn't create vast numbers of jobs. Given Namibia’s unemployment level of close to 55%, investment into other parts of the economy is critical for development and the improvement in the lives of the ordinary Namibian. However, non-mining fixed capital investment is dangerously low, at just 10% of non-mining GDP. This level of gross investment means that the stock of non-mining fixed capital assets has stagnated over the past four years. This is highly concerning when it comes to the prospects of future job creation, and any further decline in fixed capital investment will likely result in reductions in employment, while the labour force continues to grow. These very low levels of capital investment are indicative of a business climate that is not conducive to investment. For a recovery in investment, non-mining growth, employment and non-mining net-exports, a dramatic change in the business and investment climate is required.

Chart of the Week

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Allgemeine Zeitung 2025-06-24

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Chart of the Week

Kommentar

Allgemeine Zeitung 2025-06-24

Bitte melden Sie sich an, um einen Kommentar zu hinterlassen

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