By the close of June 2026, companies operating in Namibia had accumulated N$155 billion in borrowing from abroad, much of it passed along between firms that are related to one another, a sum equal to more than half of what the country produced in the whole of 2025. Such figures are not in themselves a verdict on a nation's prospects, since outside capital has long helped build what a country becomes; the difficulty lies in the reckoning that comes when debts fall due and must be paid in a currency the borrowers do not always earn. The Financial Stability Report, which looks at the first half o
Namibian Companies Borrow N$155 Billion Abroad, Mostly Through Intercompany Loans, Raising FX Risk Concerns
Borrowing abroad is not an issue until it comes to repayment
Mark
Why does N$155 billion matter so much?
Mimi
It's 55.5% of 2025 GDP, and it sits inside total corporate debt of N$219.3 billion. Foreign debt is now N$164.4 billion of that, up 13.1% in six months.
Mark
Who is borrowing?
Mimi
Mostly mining companies, through intercompany loans, meaning money from related firms abroad. Other sectors are using more trade credit, and state-owned enterprises borrow with government guarantees, now N$9.4 billion.
Luke
Is N$155 billion the same as the N$164.4 billion foreign debt figure?
Mimi
They're different numbers in the article, and it doesn't explain the gap. I'd treat them as separate measures.
Mark
So where does the risk come from?
Mimi
Currency. If the Namibian dollar weakens for a sustained period, servicing foreign-denominated debt costs more in local terms, and repayments draw on reserves.
Luke
Has that happened? Is anyone in trouble?
Mimi
Nothing in the reporting says so. The report warns about exposure and calls for close monitoring. It doesn't describe any defaults or distress.
Luke
And repayments fell, to N$21.5 billion from N$23.7 billion. Is that reassuring?
Mimi
Only partly. The report says it reflects a large repo repayment in 2025 and lower trade credit repayments, so it's not a sign of easing debt.
El Pulso
- Foreign corporate debt climbed 13.1% in six months to N$164.4 billion, outpacing domestic borrowing that grew only 2.8%.
- Mining companies lent to one another across borders, and that intercompany flow drove most of the swelling total.
- Corporate debt now stands at 74.5% of GDP, up from 69.8%, and the ratio is climbing with every new loan.
- Regulators are urging close monitoring, because a sustained slide in the Namibian dollar would inflate what firms owe in local terms.
- The weight now rests on whether the currency holds and whether foreign borrowing keeps outrunning domestic credit in the next report.
By the close of June 2026, companies operating in Namibia had accumulated N$155 billion in borrowing from abroad, much of it passed along between firms that are related to one another, a sum equal to more than half of what the country produced in the whole of 2025. Such figures are not in themselves a verdict on a nation's prospects, since outside capital has long helped build what a country becomes; the difficulty lies in the reckoning that comes when debts fall due and must be paid in a currency the borrowers do not always earn. The Financial Stability Report, which looks at the first half of the year, has chosen to watch this growing reliance on foreign funds closely, aware that a weakening Namibian dollar would make every such obligation heavier to carry.
By the end of June 2026, companies working in Namibia had borrowed a cumulative N$155 billion from outside the country, and most of it moved between related firms rather than through conventional bank lending. That amount equals 55.5% of the nation's 2025 output, and it has prompted a clear warning from those charged with protecting financial stability.
The figures come from the 2026 Namibia Financial Stability Report. Total corporate debt rose 10.3% over the first half of the year, reaching N$219.3 billion, and nearly all the momentum came from abroad. Foreign corporate debt grew 13.1% to N$164.4 billion. Mining companies, borrowing from affiliated firms, accounted for much of the surge, while trade credit in other sectors and higher non-resident deposits in local banks added to it. State-owned enterprises, backed by government guarantees, also increased their foreign borrowing, from N$8.9 billion to N$9.4 billion.
Foreign borrowing is not condemned outright. The strain appears when repayment falls due, because those payments draw on the country's foreign reserves and can leave foreign lenders as the main beneficiaries of local operations. Private-sector foreign repayments did fall to N$21.5 billion from N$23.7 billion a year earlier, though the report attributes that partly to an unusually large repurchase payment in early 2025.
Domestic borrowing, by contrast, moved slowly. It rose 2.8%, to N$54.9 billion, and regulators view it as less worrying because it is tied to activities that sustain the economy. The overall picture is sobering: corporate debt climbed from 69.8% to 74.5% of GDP, driven mainly by external funds.
The central concern is simple. If the Namibian dollar weakens for a sustained period, companies will need more local currency to service their foreign obligations, weakening balance sheets and eroding repayment capacity. Those pressures could eventually reach the nation's reserves. Observers will be watching the currency and the next report to see whether foreign borrowing continues to outpace domestic credit.
By the end of June 2026, companies operating in Namibia had borrowed a cumulative N$155 billion from outside the country, most of it through lending between related firms. That sum equals 55.5% of what the country produced in 2025, measured in nominal GDP, and it has drawn a warning about exposure to foreign exchange risk.
The figures come from the 2026 Namibia Financial Stability Report, which covers the first half of the year. Total corporate debt rose 10.3% over six months, from N$198.9 billion at the end of 2025 to N$219.3 billion at the end of June. Foreign corporate debt did most of the work, expanding 13.1% to N$164.4 billion.
The report attributes the rise mainly to higher direct investment intercompany borrowing, particularly among mining companies. Two other factors also contributed: greater use of trade credit by corporates in other sectors, and higher non-resident currency and deposits held with domestic banks.
State-owned enterprises are also borrowing abroad, using government guarantees. Between 31 December 2025 and June 2026, their borrowing rose from N$8.9 billion to N$9.4 billion.
The article notes that foreign borrowing is not a problem in itself. The difficulty arrives at repayment, which draws on the country's foreign reserves and lets foreign financiers benefit from local operations. Private-sector foreign debt repayments fell to N$21.5 billion by the end of June 2026, down from N$23.7 billion a year earlier. The report explains the decline as partly a high base effect, since resident deposit-taking corporations made a sizeable repurchase agreement repayment in the first half of 2025, and partly lower trade credit repayments in the other sectors category.
Domestic borrowing moved far more slowly. Domestic corporate debt grew 2.8%, from N$53.4 billion to N$54.9 billion, reflecting higher credit uptake by corporates. Installment and leasing credit climbed 11.1%, overdrafts rose 4.7%, and other loans and advances rose 3.5%. (The source gives the earlier comparison date as December 2026, which appears to be a slip for December 2025.)
Taken together, the first half of 2026 saw external funding grow faster than domestic borrowing, with intercompany lending the main driver of foreign debt. Corporate debt as a share of GDP rose as a result, from 69.8% at the end of 2025 to 74.5% at the end of June 2026, mainly because of external debt.
The authorities responsible for financial stability regard domestic corporate borrowing as of relatively little concern, since it is largely tied to sectors that support economic activity. Foreign corporate debt is another matter. The report states that its continued rise warrants close monitoring, because heavier reliance on external borrowing increases corporates' exposure to exchange rate risk.
The mechanism is straightforward. A sustained depreciation of the Namibian dollar would raise the domestic-currency cost of servicing debt denominated in foreign currency. Weaker corporate balance sheets and reduced repayment capacity add to the risk, and these pressures could in turn affect foreign exchange reserves and broader financial stability. What to watch is the direction of the Namibian dollar and whether foreign debt keeps outpacing domestic borrowing in the next report.
Citas Notables
The continued rise in foreign corporate debt warrants close monitoring, as greater reliance on external borrowing increases corporates' exposure to exchange rate risk.— 2026 Namibia Financial Stability Report
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Economy & Finance