Vehicle sales, credit extensions expand investment
The investment index has expanded by 4.0 index points while the consumption index has grown by 1.4, notes the Institute for Public Policy Research (IPPR)’s latest report.
This growth has been supported by stable vehicle sales and credit extensions.
Namibia Statistics Agency (NSA) Namibia’s Consumer Price Index (NCPI) also shows the all-items index for December 2013 increased to 104.9 points from 104.7 in November. This was a result of a monthly increase recorded in all the groups comprised in the NCPI, with the exception of communication and transport, which recorded declines of 1.2 and 0.3 %, respectively.
The sub-category, fruits, recorded the highest annual inflation rate of 16.6% in June 2013 while a year earlier, the highest annual inflation rate of 18.6% had been registered in the meat category in April 2012, states the NCPI report.
On the other hand, the lowest annual inflation rates of -1.7% and 1.6% for the years 2012 and 2013 were recorded for fruits and bread sub-categories in April 2012 and November 2013.
While the steady vehicle sales supported the investment index last November with the highest units sold in 2013 being 1 583, the IPPR report stresses on the notable expansion of 21.6 points on account of abnormally high commercial vehicle sales in Namibia.
The Simonis Storm Securities (SSS) December vehicle sales, however, paint a different picture. They represent a yearlong record of just 1 190 vehicles sold, translating to a 24.4% drop in monthly sales. Meanwhile, it has records of a year-on-year increase of 18%, hence “year to date vehicle sales stand at 16 053 units, confirming our initial estimates that year-on-year end sales will exceed.”
SSS economist Daniel Kavishe says the monthly drop in sales represents a dip synonymous to the festive season - December is famous for a decline in vehicle sales.
The low interests environment, according to Kavishe, has led to a situation where demand outstrips supply.
“Supply constraints were further exacerbated by the four quarters (4Q) negotiations between South African transport, allied workers union and vehicle manufacturers. Car dealers are convinced the spill over effects of last year’s labour unrest will linger during the first quarter of this year (1Q 2014).”
The main reason for this, he adds, would be Government’s failure to issue tenders for vehicle purchases whenever a year draws to an end. This may have contributed to the lower sales numbers recorded during the intervening period.
The NCPI report also points out the decline in the transport sub-sector with the purchase of vehicles falling 106.9 points in December from 107.3 in November. This, after a constant increase from July to November 2013 with 103.8 index points recorded in July and 107 in November.