Namibia has settled its $750 million eurobond, marking the largest single-day debt maturity in the history of the Southern African country, Bloomberg reported on Wednesday, October 29.
“We have already made the payment,” said Central Bank Governor Johannes !Gawaxab in the capital, Windhoek, on Wednesday.
Meanwhile, Finance Minister Ericah Shafudah stated that the debt settlement “enhances our credibility and positions us favorably for future financing in global capital markets, should circumstances justify it.”
The bond, issued in 2015, was paid using $444 million from a so-called “sinking fund” for debt repayment, in addition to loans organized by Standard Bank Namibia, FNB Namibia, and Bank of Windhoek, in partnership with Absa Namibia, the minister explained.
The government issued the bond with an interest rate (coupon) of 5.25% and used the funds to finance infrastructure, development, and support the national budget. According to the Bank of Namibia, the payment will reduce the country’s foreign reserves to approximately $2.7 billion by December 31, down from $3.1 billion recorded at the end of September.
“The payment sends a clear signal to international investors: Namibia remains a credible and disciplined borrower,” said Almandro Jansen, economist at Simonis Storm Securities Ltd, adding that “it demonstrates that despite a challenging external environment and high financing costs, the country has managed to maintain fiscal stability and adequate reserves.”
However, Jansen warned that “if the current trajectory persists, where debt outpaces growth and investment remains weak, the country risks compromising its hard-earned fiscal reserves.”
Source: Diário Económico
