Iilonga S. N.

221236864

A discussion of the effects of the COVID-19 pandemic on the

Namibian economy
Introduction
Although the outburst of the COVID-19 pandemic affects all sectors in the
country, there are those that got the short side of the stick depending on
the foundation of their operation. “The pandemic represents a rare but
narrow window of opportunity to reflect, reimagine, and reset our world.”
(Schwab,2020). This essay discusses the many effects that COVID-19 has
had on the different sectors of the Namibian economy. Amid the sectors
discussed and considered in this essay are the tourism sector, healthcare
sector and the informal business sector.
Tourism sector
The sector of tourism is centered primarily around the movement of people
both domestically and internationally, so it is safe to say that the decline in
the tourist activity is due to the pandemic. Tourism is among the biggest
sectors in the Namibian economy as it contributes billions to the gross
domestic product, which declined by a drastic 81.9% due to the pandemic
(Bank of Namibia,2020). Majority of the businesses in the sector are small
and medium businesses with minimal access to financial resources, hence
restricting the ability for some of the businesses to survive the shock, for a
lengthy period of time. As a result of the pandemic, some of the businesses
closed while others made absurd cuts to their operations, therefore ensuing
in loss of income and reduced employment rates (Bank of Namibia,2020). It
is therefore safe to assume that the tourism industry has been the hardest
hit by the pandemic which subsequently led to a negative impact on the
economy.
Healthcare sector
The Namibian healthcare sector, which prior to the pandemic was already
struggling, took one of the hardest hits due to the outbreak of the
pandemic. The services of public hospitals grew in high demand despite
the lack of more sophisticated testing equipment which are mostly found in
private hospitals hence, too expensive for the ordinary population
according to Ozili and Arun (as cited in Julius, Nuugulu & Homateni, 2020).
The healthcare workers are said to be understaffed and overworked, and
some had to go into quarantine (MoHSS Media Statement, 2020). As of
the 22nd of August 2021, 4240 healthcare workers tested positive for
COVID-19 and consequently 25 died due to COVID-19 (Namibia COVID-19
Situation Report No. 522, 2021). There has been a significant increment to
the share of the national budget allocated to the healthcare sector to from a
measly N$3,705,221,000.00 in the 2019/2020 financial year to
N$8,081,016,000.00 in the 2021/2022 financial year (Ministry of Finance,
2021). It is safe to assume that the increment is a result of the pandemic,
and it may have quite detrimental effects on the economy.
Informal business sector
A sector encompassing of small elements, working in the making of goods
and services, but whose activities were not recognized, recorded,
protected, or regulated by public authorities International Labor
organization as cited in Julius et al., (2020) is the definition of the term
informal sector. The very nature of this sector is perhaps the reason as to
why it was so heavily impacted by the pandemic. Shebeens, barbers,
hairdressers and taxis are examples of informal businesses that had to halt
their operations due to the pandemic because of government induced
regulations which prevented them from operating in attempts to curb the
spread of COVID-19 in the country. This situation left many homes with
little or no source of revenue and a decrease in economic activities in
certain rural areas (Julius et al., 2020).
Conclusion
In summary, the impact of the pandemic on the Namibian economy can be
observed from the sectors mentioned above. Although, the exact effect it
has on economy varies drastically from sector to sector. It would be wise
for the government to have contingency plans to help when such
incidences occur in the future.
 Reference
Bank of Namibia (2020). Bank of Namibia 2019 Annual Report. Retrieved,
April 11 2020, from:
https://www.bon.com.na/CMSTemplates/Bon/Files/bon.com.na/3a/3af2b4c
e-c0f2-4e99- 9d68-dc64a7c1ecb4.pdf
Budget Information, Ministry of Finance
http://www.parliament.na/wp-content/uploads/2021/07/Vote13_Health.pdf
Julius, E., Nuugulu, S. and Homateni, L. Estimating the Economic Impact of
COVID-19: A Case Study of Namibia. Retrieved, April 15 2020, from:
https://mpra.ub.uni-muenchen.de/id/eprint/99641
Namibia COVID-19 Situation Report No. 522, 2021. Retrieved, August 22
2021, from:
https://reliefweb.int/report/namibia/namibia-covid-19-situation-report-no-
522-22082021
Statement at the 28th COVID-19 Public Briefing. Retrieved, May 28 2021,
from:
https://namibiatourism.com.na/uploads/file_uploads/Statement%20at%20th
e%2028th%20COVID-19%20Public%20Briefing%2028.05.2021.pdf

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