The Namibian business climate improved the previous month, thanks to a to public investment in automobiles and new business ventures.
According to the latest business climate index released by the Director of Institute for Public Policy Research (IPPR), Graham Hopwood this morning, business index gained by 2.8 index points.
"The improvement was still well below the confidence levels measured during March. Key to the May recovery were investments in new business ventures and commercial vehicles. In this regard, company registrations rose by 8% month on month while commercial vehicle sales rose by 20%. This led to a 7.1% rise in the investment index and a knock-on effect for the leading indicator, which grew by 10 index points – suggesting that the business climate will improve six months down the line," IPPR says.
IPPR also notes the increase in consumer confidence which went up 4.3 index points and remained above the 100 point index level for the fourth consecutive month.
"The consumer index has stabilised over the past 4 months and more importantly it has done so at historically high levels – last seen in 2005. Consumer confidence was fuelled by a renewed appetite for credit, which rose by 1% month on month and was brought about by strong growth in personal loans and mortgage advances. Passenger vehicle sales increased by 15% month on month, but these figures are yet reflect in hire purchase numbers," IPPR notes.
IPPR added that international leading indicators continued to inch upwards thus suggesting improved economic climates in the export markets.
"This was reflected in an improved export index, which rose 2 index points as metal prices traded 3.4% higher than the previous month, while uranium prices, which have been on a downward trajectory for the past 30 months, stabilised during May. Further support came from fish exports, where foreign currency translation increased fish prices in local currency terms," IPPR says.