WINDHOEK, 16 JUL – The domestic market debt makes up 67 per cent of government’s total debt amounting to N$76.6 billion, with foreign debt making up the remaining 33 per cent, Minister of Finance, Calle Schlettwein said.
Addressing a media conference on the state of the economy and tax matters here on Monday, Schlettwein said of the total debt, foreign bonds made up 23 per cent while multilateral loans made up 9 per cent.
He said bilateral loans which include Germany and China only totalled N$1.1 billion or about 1 per cent of the total government debt.
Schlettwein said although China only made up a small percentage of Namibia’s total debt, the country had benefited from the Chinese government a total of N$1.34 billion in grants; N$302 million for an interest free loan; and concessional loans of N$1.7 billion.
He explained that the loans offered were provided within mutual understanding between the two governments and contain concessional terms and conditions as opposed to market loans or other borrowing.
“Concessionality is achieved either through interest rates below those available on the market, the grace period and lower management and commitment fees,” he said.
The terms for the concessional loans are 2 per cent in interest; 0,5 per cent commitment fees on undisbursed balance of the loan; five years grace period before repayment of principle start and a 15-year repayment period.
Schlettwein added that apart from machinery and highly-specialised skilled labour that Namibia does not have, locally available material consumed in such projects were Namibian-sourced.
The projects that benefited from this borrowing are the construction of the National Youth Centre, Omakange-Ruacana Roads (60 kilometres), Engela-Uutapi road (90 kilometres), the installation of scanners at all borders, electronic documents recording management system with the Office of the Prime Minister and TransNamib locomotives.
“The debt service towards the Chinese loan includes capital repayment and interest and, in total, amounts to N$65 million. As a portion of total debt serving obligations, the debt serving for loans from China is around 1 per cent of total debt servicing obligation,” Schlettwein stated.