Namibia’s central bank governor has cautioned that rising tensions between the U.S. and South Africa could have a destabilizing effect on Namibia’s economy.
Namibia’s central bank governor has cautioned that rising tensions between the U.S. and South Africa could have a destabilizing effect on Namibia’s economy.
He highlighted the nation’s strong economic ties with both countries and the vulnerability of the Namibian dollar, which is pegged to the South African rand, Bloomberg reported.
On February 7, President Donald Trump issued an executive order freezing all U.S. aid to South Africa, citing alleged human rights violations linked to the country’s new land expropriation law.
He also pointed to South Africa’s case at the International Court of Justice, where it accused Israel of committing genocide in Gaza—claims that have been widely disputed.
Namibia is closely monitoring the impact of the escalating U.S.-South Africa dispute, Central Bank Governor Johannes! Gawaxab said.
“Our currency is pegged to the South African rand, so any impact on the rand will directly affect us,” the governor said. “It’s too early to tell what the full implications will be, but we need to monitor the situation closely.”
!Gawaxab made his comments during a briefing to announce the central bank’s interest rate decision.
The Monetary Policy Committee cut the key rate by 25 basis points to 6.75%, marking the fourth consecutive reduction as inflation remains under control and economic growth slows.
The rate cut aligns with South Africa’s recent monetary policy move. Given Namibia’s currency peg to the rand, its central bank often mirrors decisions made by the South African Reserve Bank.
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