19 Sep 2016

Minister of Finance and Development Planning, Mr Kenneth Matambo has called for efficiency, effectiveness and value for each Pula spent in the national budget.

Officiating at the Budget Pitso for Local Authorities in Gaborone, September 16, he said it was critical that the impact on the economy of each project undertaken forms the basis of selecting and implementing any given project.

Mr Matambo said forecasts of revenue and expenditure by the ministry point to consecutive budget deficits in the next three financial years, including this financial year due to some global economic challenges that affect government revenue flows.

In this regard, he said the country cannot afford to have continued budget deficits over an extended period, less it risks being downgraded by international credit rating agencies such as Moody’s Investment Services and Standard and Poor’s.

“Sometimes when we in the ministry mention the economy being downgraded by these agencies, people ask us so what? Who are they anyway and what does it have to do with us and what does that mean? I want to indicate to you that it is important to manage our economy in the best possible manner to avoid the downgrading because if we are properly graded, there are benefits such as now when revenues are declining and not enough to cater for our expenditures, we have a choice to borrow,” he said.

Mr Matambo said in the case of Botswana, as a result of prudent economic management, the country may also tap from the reserves, but noted that this cannot be done continuously as they may be depleted.

Mr Matambo further told stakeholders that notwithstanding the challenges, government has introduced the Economic Stimulus Programme (ESP) whose aim is to boost domestic economic growth, economic diversification and creation of jobs.

“Implementation of ESP is however being undertaken on the backdrop of diminishing revenues in the wake of the constrained global economic situation,” he said.

He also said despite the forecast budget deficits, the 2017/18 budget will be done in the context of supporting the five 2017/18 national priority areas of developing diversified sources of economic growth, human capital development, social development, sustainable use of natural resources and consolidation of good governance and strengthening of national security.

The minister further said it was critical that local authorities as implementers of the budget at local level, they put concerted effort in influencing the context of the draft2017/18 budget strategy paper.

“It is also important for you to share with us the challenges you encounter at the implementation stage so that appropriate solutions can be undertaken, where feasible,” he said. ENDS