Guest Contributor | Feb 20, 2024 | 0
Credit demand remained feeble in February
Private sector credit extension (PSCE) growth remained sluggish in February near the weakest growth rate on record, according to the Bank of Namibia’s latest Money and Banking Statistics report.
PSCE growth ticked higher to 2.1% year-on-year in February from 1.8% in the month before. Growth in total credit extended to businesses rose to 1.6% year-on-year in February from 1% in January.
The central bank ascribes this improvement to an increase in other loans and advances extended to corporations in the mining, retail and manufacturing service sectors.
The growth in credit extended to households edged higher to 2.6% year-on-year in February from 2.5% in the previous month. The central bank stated that there was a modest uptake of mortgage credit, amid declines recorded in all other household credit categories.
Research Analyst at PSG Namibia, Shelly Louw said the anaemic growth in monetary and credit aggregates in the first two months of the year is a sign that economic activity remained weak in the first quarter of 2021.
“Although progress is being made with Covid 19 inoculations on the local and global front, it is probable that Namibia’s coronavirus related downturn will continue in the first half of 2021. Namibia and some of its major trade and tourism partners are still emerging from a second wave of Covid 19 infections at the start of 2021 and in some European countries third waves have emerged,” Louw added.