05 Feb 2018

Botswana continues to be rated annually by major sovereign credit rating agencies of Standard & Poor’s and Moody’s Investor Service as part of its efforts to maintain a competitive economy, says Minister of Finance and Economic Development, Mr Kenneth Matambo.

Presenting the Budget Speech on February 5, Mr Matambo said that such ratings entailed the assessment of the country’s various macro-economic policies and indicators with a view to determining the country’s economic fundamentals.

Mr Matambo said both rating agencies maintained Botswana’s “A” investment grade rating during 2017, adding that Standards & Poor’s even revised Botswana’s economic outlook from a negative status to stable, thus reflecting the country’s track record on prudent economic management. He said that such assessments were critical for giving investors an objective view of the domestic business environment, which was necessary for attracting foreign investment.

“In order to ensure continued favourable ratings in the future, it is imperative that Botswana continues to manage its economic and public debt prudently to avoid eroding its cash balances through unsustainable budget deficits."

However, on Exchange Rate Development, Mr Matambo said exchange rate development in the domestic economy continued to show stability, with the Real Effective Exchange Rate (REER) registering a marginal appreciation of 0.1 per cent over the 12 months to October 2017.

He said that in the 12 months to December 2017, the Pula depreciated against the South African Rand by 1.8 per cent while appreciating by two per cent against Special Drawing Right (SDR). ENDS