DBN enthusiastic about business growth
Economic expert, Dr Michael Humavindu, manager of research at the Development Bank of Namibia (DBN) said that Namibia can expect a boost in economic growth for 2012.
In its forecast for this year, DBN says it expects economic growth to increase, given private sector diversification and investments.
Based on the estimated 3.8% gross domestic product (GDP) growth of 2011, Humavindu predicts that the local economy will grow between 4% and 4.2% in 2012.
“Therefore, the business growth outlook is positive as we expect private sector growth to be broad based, involving increased uranium output, investment in construction and the mining industries, as well as in manufacturing. Government’s procurement initiatives such as the Targeted Intervention Programme for Employment and Economic Growth (TIPEEG) will also greatly enhance economic activity,” Humavindu said.
According to the Namibia Macro-economic Outlook 2011/2012 report by Investment House Namibia for 2011, Namibian GDP was forecasted to grow by 4.6% in 2011 and is expected to accelerate further in 2012 by 5.1%.
During the course of this year, the Development Bank aims to increase its total loans and equities portfolio to at least N$1.6 billion. This is in line with its plan and targets to grow its loan book by N$300 million in new advances for 2011.
Furthermore, in addition to maintaining the 2011 momentum, DBN will also focus on critical portfolio management aspects such as ensuring correct configuration of short, medium and long term loans to ensure sustainability. “The bank will also continue looking at opportunities to increase its equity investments portfolio,” he said.
The bank also expects the small and medium enterprise (SME) sector to grow further in 2012.
“We expect this growth to continue in 2012, as the anticipated broad based economic activity will foster linkages at sectoral value chain levels and so increase SMEs and other businesses’ need for financing,” said Humavindu.
Based on preliminary estimates, the bank advanced financing to 299 entities in 2011.
“And DBN’s target was to grow its loan book by N$300 million in new advances for 2011 and this target has been achieved,” Humavindu said.