Taxpayers face N$11.8bnin state-backed debt

State-owned enterprises are paying less to the government while taxpayers remain exposed to N$11. 8 billion in state-guaranteed debt, as falling mining revenue adds pressure to public finances. The amount is equivalent to 4% of Namibia’s gross domestic product, highlighting the financial risk the government faces if public enterprises struggle to repay their loans. The pressure is becoming more visible as government revenue falls short of expectations. In the 2026/27 financial year mid-year budget review tabled in parliament, finance minister Ericah Shafudah says lower dividends from public enterprises, together with falling mineral royalties, had forced treasury to revise its revenue projections downwards. “Non-tax revenue has been revised down to N$5 billion from N$6. 1 billion, mainly due to lower mineral royalties and public enterprise dividends,” Shafudah says.

The revision means the government expects to collect N$1. 1 billion less in non-tax revenue than initially budgeted, adding to the pressure on public finances. Public enterprises are expected to contribute to state revenue through dividends and other payments when they make profits. That money can help the government fund public services and reduce the pressure to raise taxes or borrow more. But with dividends declining, the state has less money coming in at a time when its mining revenue is also under pressure. Shafudah says mining remained the main source of weakness, with mining company taxes and royalties expected to fall to N$5. 2 billion from N$6. 1 billion. Diamond revenue has been hit particularly hard. “Diamond taxes and royalties have fallen from N$5. 8 billion in 2023/24 to a projected N$414 million in 2026/27, an estimated shortfall of N$5. 3 billion over the medium-term expenditure framework,” she…