WINDHOEK, Feb. 19 (Xinhua) -- Namibia central bank on Wednesday cut its prime lending rates by 25 basis points to promote economic growth and also sustain the existing currency peg with South Africa.
The Namibian central bank said the Namibian economy is expected to continue shrinking because of the drought while retail and trade sectors are expected to continue experiencing challenges.
Bank of Namibia governor Ipumbu Shiimi said the reason behind cutting lending rates was also influenced by poor global economic performance.
"Global real GDP is estimated to slow down by 2.9 percent from 3.6 percent. Slower growth was generally as a result of uncertainty on world trade," he said.
The Bank of Namibia however said the country's construction sector which has been under pressure for more than three years has started to improve slightly.
Shiimi said the Namibian economy will continue to be subdued because of the existing world challenges but is expected to rebound as time progresses in the year.
He also added that the lowering of the rates will encourage Namibians borrow for development.
