Tourism a drag on business index

About 75% less visitors arrived at Hosea Kutako International Airport in the first eight months of 2020 than in the same period last year.This pose “severe challenges” not only to the tourism industry, but also to Namibia's foreign exchange reserves, according to the IJG Business Climate Monitor (BCM) released yesterday.International tourist arrivals at the airport continues to increase, but remains a fraction of arrivals in previous years, the BCM said.In August, 644 tourists came to Namibia – 20 332 or 97% less than August 2019. Tourist arrivals and departures is one of the indicators used to compile the BCM. The latest BCM shows 16 of the 31 indicators recorded an improvement during August, but the value of 15 deteriorated.The BCM increased from 53.8 in July to 54.8 in August 2020, while the Leading Indicator remained unchanged at 66.7. Indicators used in the BCM include copper, gold, diamond and uranium production and prices; exports and imports; lamb and beef, as well as fuel prices; inflation and the exchange rate. It also takes into account the following: buildings plans, new vehicle sales, tourist arrivals and departures, company registrations and credit extended to the private sector.LivestockAfter a continuous upward trend since April 2020, the number of livestock marketed declined by more than 5 000 to 21 179 in August, according to the BCM. In August 2019 a total of 47 883 was marketed. The total number of livestock marketed until August stood at 174 477 compared to 344 655 a year earlier.Despite the drop in numbers, both beef prices and lamb prices decreased compared to July 2020, the BCM said. “Beef was selling on average at N$41.09/kg and lamb at N$51.94/kg. While average beef prices for the first eight months remained almost unchanged compared to 2019 – N$43.92/kg compared to N$43.51/kg – average lamb prices increased by almost 20% from N$40.77/kg to N$46.84/kg.” Taking a knockThe mining sector took a knock in August, the BCM reported. Copper production declined from 774 tonnes a month earlier to 596, gold production from 542 kg to 441 kg and diamond output dropped by more than a quarter to 88 847 carats. “Despite the lockdown, diamond production this year is only down by some 23 000 carats to 1 121 015 and copper production by some 1 100 tonnes to 8 910 tonnes. In contrast, gold output increased by 40 0kg to 4 291 kg.”Namibia's trade deficit narrowed from N$3.5 billion in July to N$1.9 billion in August. Overall imports decreased by 14.4% and exports by 12.8% over the first eight months of 2020 compared to the same period in 2019.ConstructionThe value of building plans completed in Windhoek increased by almost N$70 million to N$395 million, but the value of building plans approved dropped by N$30 million to N$111.9 million. “However, the value of building plans completed this year rose by 63% compared to last year in contrast to the approved plans which declined by 5%,” the BCM reported. Vehicle sales also remain subdued and came in lower at 593 in August compared to 666 in July. The number of passenger vehicles decreased by about 20 and of commercial vehicles by about 70. “These figures are reflected in the amount of credit extended to individuals that dropped slightly to N$59.1 billion, while the amount extended to businesses rose to N$43.2 billion,” according to the BCM. Business registrations showed divergent trends, it noted.“The number of new CCs rose, but the numbers of companies and defensive name registrations declined.”

Tourism a drag on business index

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