Transport crucial in facilitating trade
Annual growth in the transport subsector declined by 5.4% last year.
Phillepus Uusiku-The transport sector plays a significant role in facilitating trade to ensure that goods reach their final destinations when countries are importing (buying) and exporting (selling).
According to the Namibia Statistic Agency (NSA) latest annual national accounts report, the real value added of the transport and storage sector contracted for the third consecutive year by 3.4% in 2019.
The decline in the sector is attributed to the transport subsector that declined by 5.4% in 2019 when compared to a contraction of 5.0% registered in 2018, NSA says.
The NSA emphasised that, the real value added of all the transport subsectors contracted in 2019 with the exception of railway transport that posted a positive growth of 8.8% in 2019 compared to 7.3% recorded in 2018. This is due to the increase in the volume handled for transported goods.
Goods flows
Namibia continues to be a net importer of goods and services over the period of 2013 to 2019, thus
recording trade deficits throughout that period. The value of goods imported increased to nearly N$76.8 billion in 2019 from about N$74.8 billion in 2018, NSA says.
Imports of services increased by 7.2% to nearly N$8.4 billion in 2019 from some N$7.8 billion in 2018. Thus, the total imports of goods and services increase by 3.1% to nearly N$8.2 billion in 2019, the NSA says in their analysis.
On the other hand, the value of goods exported in 2019 amounted to around N$56.3 billion down by 0.2% from the 2018 levels. A similar trend was also observed in the services exported, contracting by 7.2% to nearly N$7.7 billion from approximately N$8.3 billion recorded in 2018. In 2019, export of goods and services was valued at some N$63.98 billion down by 1.1% from some N$64.7 billion in 2018, the NSA added.
Deficit
When imports exceed exports, it results in trade deficit. This implies that, the domestic economy is more of a consumer than a producer. Therefore, expenditure will outweigh the revenue generated because the government is buying more than it is selling.
As a result, the government will have to seek other alternative ways of generating income to make up for the deficit made with borrowing being one of the options. This exercise is however risky as it could lead to unsustainable debt levels.
It is important that governments invest in strategic untapped areas such as the manufacturing and agriculture sector to produce sufficient goods which will be able to satisfy the domestic market and export the surplus to other international markets. By doing so, this will ensure that the government generate sufficient revenue to re-invest in the economy as well as solve other threatening major macroeconomic challenges.
According to the Namibia Statistic Agency (NSA) latest annual national accounts report, the real value added of the transport and storage sector contracted for the third consecutive year by 3.4% in 2019.
The decline in the sector is attributed to the transport subsector that declined by 5.4% in 2019 when compared to a contraction of 5.0% registered in 2018, NSA says.
The NSA emphasised that, the real value added of all the transport subsectors contracted in 2019 with the exception of railway transport that posted a positive growth of 8.8% in 2019 compared to 7.3% recorded in 2018. This is due to the increase in the volume handled for transported goods.
Goods flows
Namibia continues to be a net importer of goods and services over the period of 2013 to 2019, thus
recording trade deficits throughout that period. The value of goods imported increased to nearly N$76.8 billion in 2019 from about N$74.8 billion in 2018, NSA says.
Imports of services increased by 7.2% to nearly N$8.4 billion in 2019 from some N$7.8 billion in 2018. Thus, the total imports of goods and services increase by 3.1% to nearly N$8.2 billion in 2019, the NSA says in their analysis.
On the other hand, the value of goods exported in 2019 amounted to around N$56.3 billion down by 0.2% from the 2018 levels. A similar trend was also observed in the services exported, contracting by 7.2% to nearly N$7.7 billion from approximately N$8.3 billion recorded in 2018. In 2019, export of goods and services was valued at some N$63.98 billion down by 1.1% from some N$64.7 billion in 2018, the NSA added.
Deficit
When imports exceed exports, it results in trade deficit. This implies that, the domestic economy is more of a consumer than a producer. Therefore, expenditure will outweigh the revenue generated because the government is buying more than it is selling.
As a result, the government will have to seek other alternative ways of generating income to make up for the deficit made with borrowing being one of the options. This exercise is however risky as it could lead to unsustainable debt levels.
It is important that governments invest in strategic untapped areas such as the manufacturing and agriculture sector to produce sufficient goods which will be able to satisfy the domestic market and export the surplus to other international markets. By doing so, this will ensure that the government generate sufficient revenue to re-invest in the economy as well as solve other threatening major macroeconomic challenges.
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