• IMF forecasts Namibia's GDP growth at 3.75% in both 2025 and 2026.

• Recovery supported by improved weather, boosting agriculture and energy.

• Weak global demand, structural issues, and diamond market limit momentum.

The International Monetary Fund (IMF) projects Namibia's economy to grow by 3.75% in 2025 and 2026, according to a forecast released on June 17, 2025. The recovery is mainly supported by better climate conditions following years of drought.

"The end of the drought is expected to boost growth in 2025,” the IMF said. This will stimulate key national economy sectors such as agriculture and energy.  Despite the expected rebound, the growth outlook remains fragile due to uncertainties in global trade, particularly tensions surrounding U.S. tariff policies. The continued weakness of the diamond market also weighs on government revenue.

Namibia, which relies heavily on natural resource exports including diamonds, uranium, and other minerals, remains vulnerable to international market fluctuations. Climate change adds to these challenges by affecting water supplies and disrupting mining activity, especially in coastal areas.

While the extractive sector remains exposed to external risks, the IMF highlighted Namibia's progress in controlling inflation and strengthening its external position. Inflation is expected to decline, averaging 4.1% in 2025 and around 4.5% over the medium term.

However, the IMF sees growth slowing to about 3% in the medium term due to ongoing structural constraints limiting economic potential.

Namibian authorities are more optimistic, projecting growth of 4.5% in 2025 and 4.7% in 2026. Their outlook is based on the performance of mining and agriculture, stronger consumer confidence fueled by tax relief, and promising trends in tourism, transport, finance, and energy.