22 Sep 2026

Government recorded a budget surplus of US$2.51 billion as of June 2026, equivalent to 0.85 per cent of Gross Domestic Product (GDP).

In an attempt to address the challenge of youth unemployment and poverty, the government is working on investing in upskilling them, to be entrepreneurial and job ready, in order to unlock opportunities and benefit from artificial intelligence (AI) in the modern digitalised world.

This was said by President Advocate Duma Boko while partaking in the United Nations International Children’s Fund (UNICEF) Generation Unlimited (GenU) panel discussion in New York City, United States of America on Monday.

 

President Boko said the government was looking to provide solutions to existing economic challenges facing the nation, by positioning the country to attract efficient foreign direct investment (FDI), building skills and entrepreneurial pathways as well as providing opportunities in rural communities.Officiating at the Finance and Investment Pitso yesterday, Acting President and Minister of Finance, Mr Ndaba Gaolathe, said government was proceeding with fiscal consolidation, domestic revenue mobilisation and expenditure restraint.

He said ministries, departments and agencies had, since the 2025/2026 financial year, implemented measures to reduce non-essential expenditure in an effort to ease structural fiscal pressures.

Mr Gaolathe said government remained committed to reforms aimed at strengthening tax administration, broadening revenue mobilisation and raising the tax-to-GDP ratio over the next five years.

To that effect, Parliament had approved major tax legislation covering Value Added Tax (VAT), income tax, tax administration and customs, which he said were collectively estimated to generate an additional $2.47 billion in annual revenue.

He said borrowing would nonetheless continue to support approved development and fiscal requirements, guided by debt sustainability and prudent debt management.

Mr Gaolathe said development of the domestic government securities market remained important, noting that Parliament had recently approved an increase in the government bond issuance programme ceiling from P55 billion to P85 billion.

The increase, he said, would give government greater financing flexibility and create additional room for continued development of the domestic capital market.

“The P85 billion figure is an authorised programme ceiling. It is not a borrowing target, and actual issuance will continue to reflect government’s financing requirements, medium-term debt management strategies, debt sustainability considerations and prevailing market conditions,” he said.

Additionally, Mr Gaolathe said the preliminary revised outlook for the 2026/2027 national budget now estimated a deficit of $9.26 billion, equivalent to 3.1 per cent of GDP, compared with the original projection of $26.35 billion, or 8.9 per cent of GDP.

He said the improvement reflected, among other factors, an upward revision of $8.1 billion in total revenue following higher-than-anticipated Bank of Botswana revenue.

He said the final fiscal position would also depend on government’s ability to contain expenditure and maintain fiscal prudence. Mr Gaolathe cautioned, however, that weak global diamond demand continued to weigh on economic growth, exports and public finances, while fiscal and external buffers remained under pressure.

“The nation should take confidence from the affirmation and the instruction from the outlook, especially that Botswana has retained its footing. Sovereign financing will inevitably occupy a larger place in Botswana’s economic discussions as the country works through this fiscal and structural adjustment,” he said.

He said it was therefore important to consider the resilience of the financing framework, the range of funding sources available to government and the private sector, as well as the quality of government engagement with investors and development partners. ENDS