A financial services firm on Tuesday urged the Namibian government to consider unpopular measures like reducing government personnel and cutting defense and security expenditure to regain fiscal consolidation.
The call by PSG Konsult, a financial services provider, came after Fitch Ratings’ announcement on Monday to downgrade Namibia’s long-term foreign currency credit rating to sub-investment grade.
To recover its investment-grade status, the government will have to improve its financial management and revenue collection capabilities, and amend any legislation that is causing investor uncertainty, PSG Konsult said.
“We are currently reviewing our own credit rating for Namibia, which should be updated later this month,” the firm said.
PSG Konsult said the lower credit rating from Fitch will adversely affect the ability of the central government, parastatals and banks to borrow on the international market.
In August, Moody’s Investors Service downgraded Namibia’s credit rating to junk status. Enditem