By Staff Reporter WINDHOEK Namibia’s economy is in a healthy state, and the expectation is that all key sectors of the economy will contribute positively to economic output, says the Bank of Namibia (BoN). This upbeat assessment comes on the eve of Finance Minister Saara Kuugongelwa-Amadhila tabling Namibia’s national budget for 2007/8 in Parliament today. The Bank of Namibia presented its economic outlook paper for the year 2007 at an event on Tuesday, during which it also launched its 8th Annual Symposium Publication of 2006. The bank’s Director of Research, John Steytler, presented the economic forecast to an audience of mainly financial industry professionals and the media. The BoN outlook outlines the short-term performance of the Namibian economy and forms part of the bank’s input into government’s budget preparation. The report covers the global economy including that of the USA, Euro Area, and Asia. It also gives developments in the sub-Saharan Africa, including South Africa. The report gives real sector outlook, as well as price and domestic demand developments and external trade. The report concludes on possible downside risks to the forecasted economic growth for 2007. The BoN says it expects the global economy to continue growing at a healthy pace of about 5.0 percent in 2007. Crucial downside risks remain the high and volatile oil prices, possibility of a disorderly resolution of the global imbalances, and a too abrupt cooling of the US housing market. For sub-Saharan Africa, GDP growth is forecast to grow by 6.3 percent in 2007, the highest in over three decades. The increase owes much to a surge in growth of oil producing countries, notably Equatorial Guinea and Angola. However, non-oil producing countries such as Namibia will also contribute positively to the region’s growth output, due to favourable commodity prices. On the domestic front, the BoN says the Namibian economy performed relatively well during 2006 largely due to an improvement in the primary sector. Growth in the primary sector came mainly from mining, driven by increased world demand especially for diamond and improved prices for base metals. Low international prices for fish and the appreciation of the Namibian dollar, on the other hand, negatively affected the activities of the fishing sector. Despite increasing international prices for beef and the good rainfall during the year, the agriculture sector did not perform well. The positive performance of the secondary and tertiary sectors also supported the growth in 2006. The year 2006 witnessed an increasing rate of annual inflation compared to the previous year. The main causes of the increase in the 2006 inflation rate were increases in food and transport prices, mainly resulting from hikes in the price of fuel. The overall balance of Namibia’s balance of payments is estimated to have recorded a surplus in 2006 mainly resulting from good performance of the current account as a result of windfall revenues from SACU and the estimated first-ever trade surplus driven mainly by high base metal prices. Looking ahead, BoN said the economy is expected to continue performing well in 2007. Growth is expected to be broad-based, with all key sectors of the economy expected to contribute positively to output. The country’s central bank says one can conclude that the economy is in a healthy state, based on available information contained in the Economic Outlook paper. It, however, warns that Namibia being a small open economy, vulnerable to external shocks, the downside risks to the forecast are the volatility in the prices for Namibia’s main export commodities, exchange rates, and oil prices.