13 Jul 2026

Government has developed a robust pipeline of reforms and interventions aimed at stabilising the economy, restoring confidence, strengthening fiscal resilience and accelerating economic transformation.

To accelerate economic recovery and ease reliance on diamonds, the Vice President Mr Ndaba Gaolathe revealed during the Cabinet Economic Committee that one such reform was the undertaking of the national fund of funds initiative.

The proposed national fund of funds represents a critical shift in Botswana’s economic policy as it is designed to mobilise capital from both the government and local institutions to provide strategic, diversified, and modern financial support like equity and venture debt to local businesses.

Mr Gaolathe said the national fund of funds was aimed to drive economic diversification, create jobs and fund emergent sectors like the creative and digital industries for the benefit of future generations through allowing entrepreneurs to access vital capital.

“This fund of funds will ensure that there is a coordinated enterprise readiness support and availability of catalytic finance mechanisms. And through this model, risk is systematically reduced, access to finance is expanded and private capital is crowded into productive sectors of the economy,” said Mr Gaolathe.

He noted that the objective was to ultimately ensure that no viable citizen-owned enterprise was denied access to appropriate financing because of structural gaps. 

Mr Gaolathe stated that government had been undertaking a structured programme to strengthen understanding across government methodologies applied by credit rating agencies and the broader reform expectations of investors and development partners. 

These efforts, he said went beyond preparing for the rating exercise and ensured that every leader across government had a clear and common understanding of Botswana’s reform agenda and the role that their institution played in delivering that agenda. 

“We are operating in an environment characterised by depressed economy, fiscal pressures, external uncertainties, heightened scrutiny by investors, by development partners, by international rating agencies. 

And these realities demand that we act with urgency, we act with discipline, and we act with a unity of purpose,” he said.

Mr Gaolathe indicated that government was mobilising immense technical capacity and strengthening coordination mechanisms.

With Botswana already a negative outlook by some of the  world top rating  agencies,  Mr Gaolathe  emphasised the  need for  macroeconomics to improve, cautioning that further downgrades would result in higher borrowing costs, reduced access to international capital markets, weakened investor confidence and additional pressure on the fiscas.

Thus warned that a weak economic outlook created pressure on sovereign credit ratings which in turn compounds existing economic challenges.

Furthermore, he said it was also important to confront the reality that Botswana’s business environment continued to face competitiveness challenges. 

“The World Bank’s 2025 Business Rating Assessment indicates that Botswana performs below global average in business readiness, particularly in public service delivery, in regulatory efficiency, in digitalisation and in our utility reliability,” said Mr Gaolathe.

He said the assessment painted a picture of a country where it was relatively easy to establish a business, but considerably more difficult for the business to be sustainable.

To that regard he indicated that contract enforcement, tax dispute resolution and business closure processes remained areas requiring urgent reform. ENDS