Debt to climb despite Eurobond redemption
Ogone Tlhage
The Bank of Namibia has stated that the redemption of the country’s Eurobond obligation is unlikely to have a significant effect on the government’s overall debt stock, which is expected to remain elevated by the end of the current fiscal year.
In its quarterly bulletin, the central bank noted that the redemption would cause a temporary dip in Namibia’s gross domestic product (GDP)-to-debt ratio, but not enough to reduce the ratio below current levels. Namibia’s GDP-to-debt ratio stood at 61.75% at the end of June 2025, slightly lower than the 62.7% recorded in the same quarter of the previous year.
“Going forward, the total debt stock is anticipated to dip in October 2025 when a US$750 million Eurobond is repaid, but will resume rising thereafter to reach N$172.4 billion by the end of the 2025/26 fiscal year, which translates into 62% of GDP,” the Bank of Namibia said.
In nominal terms, the total government debt stock reached N$171.4 billion at the end of June 2025, representing annual growth of 8.8%, primarily driven by increased issuance of Treasury Bills (TBs) and Internal Registered Stock (IRS).
“In contrast, the central government’s external debt registered a modest decline over the same period, partly due to the principal repayment of the IMF’s Rapid Financing Instrument (RFI), which began in the second half of 2024, and the appreciation of the Namibian dollar against major currencies,” the Bank of Namibia added.
On the fiscal front, the central government’s debt stock rose year-on-year for the fiscal year ending June 2025, while loan guarantees declined.
Total central government loan guarantees, as a percentage of GDP, fell by one percentage point year-on-year to 3% in the quarter under review. At this level, total public loan guarantees remain well below the government’s ceiling of 10% of GDP, indicating a low risk of contingent liability.
The Bank of Namibia has stated that the redemption of the country’s Eurobond obligation is unlikely to have a significant effect on the government’s overall debt stock, which is expected to remain elevated by the end of the current fiscal year.
In its quarterly bulletin, the central bank noted that the redemption would cause a temporary dip in Namibia’s gross domestic product (GDP)-to-debt ratio, but not enough to reduce the ratio below current levels. Namibia’s GDP-to-debt ratio stood at 61.75% at the end of June 2025, slightly lower than the 62.7% recorded in the same quarter of the previous year.
“Going forward, the total debt stock is anticipated to dip in October 2025 when a US$750 million Eurobond is repaid, but will resume rising thereafter to reach N$172.4 billion by the end of the 2025/26 fiscal year, which translates into 62% of GDP,” the Bank of Namibia said.
In nominal terms, the total government debt stock reached N$171.4 billion at the end of June 2025, representing annual growth of 8.8%, primarily driven by increased issuance of Treasury Bills (TBs) and Internal Registered Stock (IRS).
“In contrast, the central government’s external debt registered a modest decline over the same period, partly due to the principal repayment of the IMF’s Rapid Financing Instrument (RFI), which began in the second half of 2024, and the appreciation of the Namibian dollar against major currencies,” the Bank of Namibia added.
On the fiscal front, the central government’s debt stock rose year-on-year for the fiscal year ending June 2025, while loan guarantees declined.
Total central government loan guarantees, as a percentage of GDP, fell by one percentage point year-on-year to 3% in the quarter under review. At this level, total public loan guarantees remain well below the government’s ceiling of 10% of GDP, indicating a low risk of contingent liability.
