On a
year-to-date basis, Toyota maintained its dominance in the light commercial
vehicle space with a 53.8% market share, Ford climbed to second place with
13.5% of the market, followed by Nissan, with a market share of 13.4%. Mercedes
leads the medium commercial vehicle segment with 32.0% of sales year-to-date. Scania
remained number one in the heavy and extra-heavy commercial vehicle segment
with 25.5% of the market share year-to-date.
June was a respectable month for new
vehicle sales, despite a raging third wave of Covid-19 infections in the
country, coupled with the introduction of new lockdown restrictions. An average
of 379 new passenger vehicles were sold per month in the first half of 2021, which
is well above the average of 254 in the comparable period of 2020, but still
trails slightly below the average of 411 in the first 6 months of 2019. On the
commercial front, total commercial vehicle sales in the first half of the year
are 31.7% higher than the comparable period in 2020, with light and medium
commercial vehicle sales increasing by 25.6% and 22.0% year-on-year,
respectively, while heavy commercial vehicle sales recorded the largest
increase of 114.4% y/y. Despite these increases, the commercial sector lags
well behind the comparable period’s 10-year pre-Covid-19 average (2010-2019)
when total new commercial vehicle sales were 50.1% higher than they are now.
Overall, this reflects a long path to recovery in the commercial sector.
The City of
Windhoek approved a total of 187 building plans in May, representing a 25.2%
m/m decrease from the 250 building plans approved in April. In monetary terms,
the approvals were valued at N$173.0 million, a 26.1% m/m decrease. 183
buildings with a value of N$67.13 million were completed during May, a 27.9%
m/m decrease in value terms. Year-to-date building approvals are 66.3% and 24.8%
higher in number and value terms, respectively, than during the same period in
2020. This increase is however mostly due to stagnant construction activity during
the lockdown last year. Year-to-date, the number of completed buildings
increased by 23.3% y/y to 678, while the value of these completions fell marginally
by 3.6% y/y from N$380.0 million in 2020 to N$366.5 million in 2021. On a
twelve-month cumulative basis, 2,684 buildings with the value of N$2.01 billion
were approved, an increase of 47.7% y/y in number, and 10.7% y/y in value.
In May, 105 additions to properties
were approved with a value of N$55.4 million,
while 125 additions worth N$28.1 million were completed during the month, as
the category continues as the main contributor to the total approvals and
completions. Additions to properties approved fell 36.7% m/m in number and
40.4% m/m in value terms.
New
residential units were the second largest contributor to the total number of
building plans approved in May, and the largest contributor in value terms. 78
new units worth N$92.6 million were approved in May, representing a 28.5% m/m decrease
from the N$129.5 million worth of approvals in April. On a 12-month cumulative
basis, residential units approvals recorded a 125.3% y/y increase in value. 58 new
residential units worth N$39.0 million were completed during the month,
representing an increase in value of 17.7% m/m, but
a decrease of 21.6% y/y.
Four new commercial units, valued at
N$25.0 million, were approved in May, translating to a 115.3% m/m increase in
value terms. Year-to-date, there have been sixteen commercial building
approvals valued at N$51.1 million, which is 33.3% lower in number terms and a 79.3%
decrease in value terms compared to the same period last year. On a rolling
12-month perspective, the number of commercial and industrial approvals have
slowed to 33 units worth N$135.3 million as at May, compared to the 56 approved
units worth N$652.9 million over the corresponding period a year ago. No
commercial and industrial units were completed in May.
Private sector credit (PSCE) fell by N$214.2
million or 0.20% m/m in May, bringing the cumulative credit outstanding to
N$105.0 billion. On a year-on-year basis, private sector credit grew by 2.66%
in May, compared to the 2.74% y/y growth recorded in April. On a rolling
12-month basis, N$2.72 billion worth of credit was extended to the private
sector. N$2.34 billion worth of credit has been extended to individuals on a
12-month cumulative basis, while N$498.1 million was issued to corporates. The
non-resident private sector decreased their borrowings by N$112.2 million.
Credit
Extension to Individuals
Credit extended to individuals increased by 3.98%
y/y in May, compared to the increase of 3.91% y/y recorded in April. On a
monthly basis, household credit grew by 0.1%, following the increase of 0.6%
m/m recorded in the previous month. Mortgage demand by individuals was
unchanged on a monthly basis but rose 5.2% y/y. Instalment credit increased by
0.4% m/m and 1.5% y/y, the second consecutive month of increase on an annual
basis, following twenty consecutive months of decline. Overdraft facilities
extended to individuals increased 1.1% m/m, but increased by 5.1% y/y. Other
loans and advances (OLA) rose by 0.2% m/m and 1.3% y/y, displaying a slightly
faster rate of increase from the 0.8% y/y growth recorded in April.
Credit
Extension to Corporates
Credit extension to corporates contracted for a fourth
consecutive month declining by 1.2% m/m, following the 0.8% m/m contraction
recorded in April. On an annual basis, growth in credit extension to corporates
slowed to 1.2% y/y in May, compared to the 2.1% y/y growth registered in April.
On a monthly basis, growth in mortgage loans, other loans and advances (OLA)
and overdraft facilities extended to corporates were all stagnant. On a
year-on-year basis, mortgage loans contracted 2.4%, while OLA and overdrafts
increased 1.4% and 14.9% respectively.
Banking
Sector Liquidity
The overall liquidity position of commercial
banks deteriorated substantially during May, decreasing by N$2.7 billion to
reach an average of N$340.8 million. The BoN attributed the diminishing liquidity
position to net transfers by investment managers as well as several
cross-border transfers during the period under review. The outstanding balance
of repo’s subsequently rose to N$1.1 billion at the last week of the month.
Reserves and Money Supply
As per the BoN’s latest money statistics release, broad money supply contracted by N$1.6 billion or 1.3% y/y in May, compared to the 3.1% y/y increase recorded in April. Foreign reserve balances declined by N$2.2 billion to N$39.0 billion in May. The BoN ascribed the decrease to an increase in government payments as well as foreign currency repurchases by commercial banks.
Despite the historically low interest rates, economic
activity remains subdued, with individuals unwilling or financially incapable
of taking out loans to increase consumption, and corporates who lack
confidence to invest in capital projects would rather use the opportunity to
de-lever their balance sheets. With Namibia experiencing a third wave of
Covid-19 infections, and with it, stricter lockdown measures which hampers
economic activity, credit extension is unlikely to improve in the short-term.
